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A Oneindia Venture

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Notes to Accounts of Forbes & Company Ltd.

Mar 31, 2025

(i) Investment properties (Cost) include jointly owned Residential Premises including land with carrying amount ?1,551.52 Lakhs (Previousyear ? 1,551.52 Lakhs) and Shares in Co-operative Housing Societies, Association of apartment owners and in a Company aggregating ? 0.17 Lakh (Previousyear ? 0.17Lakh).

(ii) Investment properties includes the rights in respect of the land and building at Fort, Mumbai with net carrying value of '' 154.33 Lakhs (Previousyear '' 192.91 Lakhs) of which '' 24.09 Lakhs (Previousyear '' 30.11 Lakhs) has been disclosed under property, plant and equipment (Refer Note 5A). The Company has received approval for lease for the period 25th September, 2006 to 24th September, 2036 for 30 years U/s. 92(K) of BMC Act 1888.

6.1 Fair value measurement of the Companyâs investment properties

The fair value of the Companyâs investment properties as at 31st March, 2025 and 31st March, 2024 have been arrived at on the basis of a valuation carried out as on the respective dates by V.S.Modi, independent valuer not related to the Company. V.S. Modi is registered with the authority which governs the valuers in India, and has appropriate qualifications and recent experience in the valuation of properties in the relevant locations. The fair value was determined based on the market comparable approach that reflects recent transaction prices for similar properties as well as other lettings of similar properties in the neighbourhood. In estimating the fair value of the properties, the highest and best use of the properties is their current use. Thus, the significant unobservable inputs are recent transaction price, taking into account the differences in location, and individual factors, such as frontage and size, between the comparables and the properties. Details of the Companyâs investment properties and information about the fair value hierarchy as at 31st March, 2025 and 31st March, 2024 are as follows:

1. Forbes Container Line Pte. Ltd., Singapore (âFCLPLâ), a foreign subsidiary of the Company has been ordered to be wound by the High Court of Republic of Singapore on 19th August, 2016. An official liquidator has been appointed by the court. The Company has made full provision for investments made and loans given to FCLPL. Accordingly, this entity is no longer a related party for the Company and not consolidated in these financial statements.

2. Edumetry Inc., USA , a foreign joint venture of the Company has been dissolved vide Certificate of Dissolution dated 28th October, 2015 issued by the State of Delaware. Consequently, the Company does not have any significant influence or control over Edumetry Inc. as on date. Accordingly, this entity is no longer a related party for the Company and not consolidated in these financial statements. The Company has made full provision for these investments in earlier years.

3. In respect of Forbes Technosys Limited (FTL), the National Company Law Tribunal, Mumbai Bench (NCLT), vide its order dated March 24, 2025, has admitted the petition filed by FTL, under Section 10 of the Insolvency and Bankruptcy Code, 2016 (âIB Codeâ), read with the Insolvency and Bankruptcy (Application to Adjudication Authority) Rules, 2016. As a result, the Corporate Insolvency Resolution Process (CIRP) has been initiated, the Interim Resolution Professional (IRP) has been appointed with effect from the date of the Order. Consequently, the management and powers of the Board of Directors of FTL are now suspended and will be exercised by the IRP for the duration of the CIRP.

The Company does not have any significant influence or control over Forbes Technosys Limited and therefore it is being reclassified from Subsidiary to other investment. Further, Investments made in Forbes Technosys Limited are fully provided (Refer Note 49).

In determining the recoverability of a trade receivable, the Company considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the end of the reporting period. The concentration of credit risk is limited due to the fact that the customer base is large and unrelated.

Trade receivables of '' 3,894.87 Lakhs (Previousyear '' 3,910.46 Lakhs) were impaired. The individually impaired receivables were mainly due to unexpected difficult economic situations.

Rights, preferences and restrictions attached to equity shares

The Company has only one class of shares referred to as equity shares having a par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Description of Reserves :

Retained Earnings: Retained earnings represent the amount of accumulated earnings of the Company

Securities premium reserve: The amount received in excess of the par value of equity shares has been classified as securities premium.

General reserve: The Company created a General Reserve in earlier years pursuant to the provisions of the Companies Act,1956 where in certain percentage of profits was required to be transferred to General Reserve before declaring dividends. As per Companies Act 2013, the requirements to transfer profits to General Reserve is not mandatory. General Reserve is a free reserve available to the Company.

Capital Redemption Reserve: As per Companies Act, 2013, capital redemption reserve is created when Company purchases its own shares out of free reserves or securities premium. A sum equal to the nominal value of the shares so purchased is transferred to capital redemption reserve. The reserve is utilised in accordance with the provisions of section 69 of the Companies Act, 2013.

Other Comprehensive income: This reserve represents the cumulative gains (net of losses) arising on the revaluation of Equity Instruments measured at fair value through Other comprehensive Income, net of amounts reclassified, If any , to Retained Earnings when those instruments are disposed off.

Capital Reserve: During merger, the excess of net assets acquired, over the cost of consideration paid is treated as capital reserve.

This provision represent the Company''s best estimate of the future outflow of economic benefits that will be required for certain indirect tax and legal matters. The outflow would depend on settlement / conclusion of respective matters / cessation of expected events with respective authorities.

34. Employee Benefits :Brief description of the Plans:

The Company has various schemes for long term employees benefits such as Provident Fund, Gratuity, Superannuation, Employees State Insurance Fund (ESIC) and Employeesâ Pension Scheme, Compensated absences and Post Retirement Medical and Non Compete fees. The Companyâs defined contribution plans are Superannuation, Employees State Insurance Fund and Employeesâ Pension Scheme (under the provisions of the Employeesâ Provident Funds and Miscellaneous Provisions Act, 1952). The Company has no further obligation beyond making the contributions to such plans. The Companyâs defined benefit plans include Provident Fund, Gratuity, Post Retirement Medical and Non Compete fees.

Gratuity

The Company provides for gratuity payable to employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service.

The gratuity plan is a funded plan and the Company had obtained insurance policies with Life Insurance Corporation of India (LIC) and makes a contribution to LIC for amounts notified by LIC. The Company accounts for gratuity benefits payable in future based on an independent external actuarial valuation carried out at the end of the year using the Projected Unit Credit method.

The Companyâs Gratuity Plan is administered by an insurer and the Investments are made in various schemes of the trust. The Company funds the plan on a periodical basis.

The Company actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from the employee benefit obligations, with the objective that assets of the gratuity / provident fund obligations match the benefit payments as they fall due.

Provident Fund

The eligible employees of the Company are entitled to receive post-employment benefits in respect of provident fund, in which both the employees and the Company make monthly contributions at a specified percentage of the employeesâ eligible salary. The contributions are made to the provident fund managed by the trust set up by the Company which are charged to the Statement of Profit and Loss as incurred.

A large portion of provident fund trust assets consists of government and corporate bonds, although the Company also invests in equities, cash and mutual funds. The plan asset mix is in compliance with the requirements of the regulations in case of Provident fund.

The Company actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from the employee benefit obligations, with the objective that assets of the provident fund obligations match the benefit payments as they fall due.

Post retirement medical and non-compete fees

Under the post-retirement medical and non-compete fees, eligible whole-time directors and on their demise, their spouses are entitled to medical benefits subject to certain limits and fixed monthly payment as non-compete fee. The Company accounts for these benefits payable in future based on an independent external actuarial valuation carried out at the end of the year using the Projected Unit Credit method.

These plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk. Investment risk

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. Plan investment is a mix of investments in government securities, and other debt instruments.

Interest risk

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the planâs investments.

Longevity risk

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the planâs liability.

Salary risk

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the planâs liability.

The above sensitivity analysis are based on change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the balance sheet.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

L. Provident Fund

The Company has established âForbes & Company Ltd. Employees Provident Fundâ in respect of all the employees to which both the employee and employer make contribution equal to 12% of the employeesâ basic salary respectively. The Companyâs contribution to the provident fund for all employees, are charged to the Statement of Profit and Loss. In case of any liability arising due to shortfall between the return from its investments and the administered interest rate, the same is required to be provided for by the Company. In accordance with the recent actuarial valuation, there is no deficiency in the interest cost as the present value of expected future earnings of the fund is greater than the expected amount to be credited to the individual members based on the expected guaranteed rate of interest.

M. The liability for Compensated absences (Non - Funded) as at year end is '' Nil (Previous year '' Nil) (Refer Note 18B).

The Company provides for encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits for future encashment / availment. The Company makes provision for compensated absences based on an actuarial valuation carried out at the end of the year using the Projected Unit Credit method. Leave obligations not expected to be settled in the next 12 months is '' Nil (Previous year '' Nil).

35. Financial Instruments 35.1 Capital Management

The Company manages its capital to ensure that it will be able to continue as going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance. The capital structure of the Company consists of net debt and total equity of the Company.

The Company determines the amount of capital required on the basis of annual as well as long term operating plans and other strategic investment plans. The funding requirements are met through non convertible debt securities or other long-term /short-term borrowings. The Company monitors the capital structure on the basis of total debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

35.3 Market Risk

The Companyâs activities expose it primarily to the financial risks of changes in foreign currency exchange rates (Refer Note 35.6). The Company enters into a variety of derivative financial instruments to manage its exposure to foreign currency risk.

35.4 Credit risk management Trade receivables

Trade receivables are generally unsecured and are derived from revenue earned from customers. On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix and forwardlooking information and an assessment of the credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade receivables. Historical experience of collecting receivables of the Company is supported by low level of past default and hence the credit risk is perceived to be low.

Investments in subsidiaries, associates and joint ventures

The Company had invested in various subsidiaries, associates and joint ventures. The approved future business plans and cash flow projections of these entities are evaluated by the management of the Company on an ongoing basis and based on this evaluation the recoverability of the investments is considered to be good. (Also refer Note 8)

Other Financial assets

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are mutual funds and banks with high credit-ratings assigned by credit-rating agencies.

35.5 Liquidity Risk

Liquidity Risk refers to insufficiency of funds to meet the financial obligations. Liquidity Risk Management implies maintenance of sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit lines to meet obligations when due.

The Company manages liquidity risk by banking facilities and by continuously monitoring forecast and actual cash flows, and by assessing the maturity profiles of financial assets and liabilities. The below table sets out details of additional undrawn facilities that the Company has at its disposal to further reduce liquidity risk.

35.6 Derivatives Instruments and unhedged Foreign Currency (FC) exposure

The Company is exposed to Currency Risk arising from its trade exposures and capital/Loan receipt/payments denominated, in other than the Functional Currency. The Company has a Foreign Exchange Risk Management policy within which the treasury has to perform and also lays down the checks and controls to ensure the continuing success of the treasury function. The Company has defined strategies for addressing the risks for each category of exposures (e.g. for exports , for imports, for loans, etc.). The centralised treasury function aggregates the foreign exchange exposure and takes prudent measures to hedge the exposure based on prevalent macro-economic conditions.

d) Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)

The Company consider that the carrying amounts of financial assets and financial liabilities recognised in Note (a) above approximate their fair values.

36. Operating lease arrangements 36.1(i) The Company as lessor

The Company has entered into operating lease arrangements, consisting of surplus space in buildings to others. The normal tenure of the arrangement is upto five years. The rental income from the assets given on lease of '' 2,034.73 Lakhs (Previousyear '' 1,679.81 Lakhs) has been disclosed as âRent and amenitiesâ under Revenue from operations in Note 24 to the Statement of Profit and Loss.

b) Other Commitments

The Company has outstanding bank guarantees of '' 316.15 Lakhs (Previous Year '' 236.87Lakhs). The Company has outstanding performance guarantees of '' Nil (Previous Year '' Nil).

38. Contingencies and other commitments

(To the extent not provided for)

		'' in Lakhs
Particulars	As at 31st Mar., 2025	As at 31stMar., 2024
(a) Claims against the Company not acknowledged as debts 1 Taxes in dispute:- i) Excise demand [Advance paid against the demand '' Nil; (Previous year '' Nil)]	1.63	1.63
ii) Sales tax [Advance paid against the demand '' 55.06 Lakhs; (Previousyear'' 55.06Lakhs)]	603.41	603.41
iii) Income-tax [Advance paid against the demand '' 83.70 Lakhs; (Previousyear '' 83.70 Lakhs)]	3,500.03	4,329.14
iv) Service-tax (Advance paid '' 104.10 Lakhs) (Previous year '' 92.25 Lakhs)	2,691.65	3,424.49
v) Customs duty [Advance paid '' Nil; (Previousyear '' Nil)]	22.96	87.84
vi) GST demand	187.17	402.01
vii) Property tax demand (Refer Note 50 C)	475.29	475.29
2 Customer claims	2,785.59	2,785.59
3 Other legal matters	90.00	215.40

40. Segment reporting

The Chief Operating Decision maker of the Company examines Companyâs performance both from a product and from a geographic perspective. From a product perspective, the management has identified the reportable segments Engineering and Real Estate at standalone level.

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

Details of product categories included in each segment comprises:

Coding and Industrial Automation Segment includes manufacture/ trading in conventional and Automatic Marking Systems and Industrial Automation Business. The Company caters to the needs of domestic and export markets.

Real Estate includes income from renting out investment properties and revenue from real estate development project.

Unallocable Corporate Assets mainly comprises of investments, tax receivables and other unallocable assets.

Unallocable Liabilities comprise borrowings, provisions and other unallocable liabilities not identifiable to any specific segment.

42. In the matter of Svadeshi Mills Company Limited (Svadeshi), the Honâble Bombay High Court vide its order dt. 9th October, 2023 has allowed the Interim Application (IA) filed by Grand View Estate Private Limited (GVEPL) and the Company granting permanent stay on the winding up of Svadeshi along with directions to Official Liquidator (OL) to handover entire undertaking of Svadeshi including all its properties assets books of accounts etc. OL has been discharged as the liquidator of Svadeshi. Directors have been appointed on the Board of Svadeshi. The Company as a shareholder of Svadeshi has secured the funding availed by GVEPL for revival of Svadeshi by way of exclusive pledge of entire equity shares of the Company and its wholly-owned subsidiary Forbes Campbel Finance Limited (FCFL) in Svadeshi hypothecation of secured debt due to the Company from Svadeshi together with the underlying security and hypothecation of receivables due to the Company from Svadeshi.

Subsequently, vide order dt. 22nd January, 2025 the Division Bench of the Honâble Bombay High Court has vacated the stay on winding up of Svadeshi by setting aside the above order dt. 9th October, 2023 and directed OL to take control of its assets reserving liberty to GVEPL and Company to file fresh application u/s 466 of Companies Act, 1956. OL took control of Svadeshiâs assets on 23rd January, 2025. GVEPL and the Company filed Special Leave Petition (SLP) before the Honâble Supreme Court against the impugned order dt. 22nd January, 2025. The Honâble Supreme Court heard the SLP and vide its Order dt. 31st January, 2025 stated that GVEPL and the Company may file fresh application before the Company Judge, Bombay High Court with a prayer that winding-up of Svadeshi should not be proceeded with. Further, such fresh application to be expeditiously heard by the Company Judge. Accordingly, the Company and GVEPL have filled applications to the Honâble Bombay High Court for granting permanent stay on the winding up proceedings.

(iv) Critical judgements in determining the lease term

In determining the lease term, management considers all facts and circumstances that creates an economic incentive to exercise an extension option, or not to exercise a termination option. Extension option (or period after termination option) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). The majority of extension and termination options held are exercisable only by the Company and not by the respective lessor.

For the leases of offices premises, the following factors are normally the most relevant:

1. If there is significant penalties to terminate (or not extend), the Company is typically reasonably certain to extend (or not terminate).

2. If any leasehold improvements are expected to have a significant remaining value, the Company is typically reasonably certain to extend (or not terminate)

3. Otherwise, the Company considers the other factors including historical lease duration and the costs and business disruption required to replace the leased asset.

The lease term is reassessed if an option is actually exercised (or not exercised) or the Company becomes obliged to exercise it. The assessment of reasonably certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within control of lessee. During the current financial year, the financial effect of revising lease terms to reflect the effect of exercising extension and termination options was a decrease in lease liabilities and right-of-use assets by '' Nil and '' Nil respectively (Previous year '' Nil and '' Nil respectively).

Lessor accounting as a lessor

The Company did not need to make any adjustments to the accounting for assets held as lessor under operating leases (Refer note 36) as a results of the adoption of Ind AS 116.

48. Ind AS 115 ''Revenue from Contracts with Customers'', a new accounting standard notified by the Ministry of Corporate Affairs (MCA) on 28th March, 2018 was effective from accounting period beginning on or after 1st April, 2018 and replaced the existing revenue recognition standards. The application of Ind AS 115 had a significant bearing on the Company''s accounting for recognition of revenue from real estate development projects. Considering the terms of the contract, receipt of Occupancy Certificate for Phase II of the real estate development project, issuance of possession letters and transfer of control of the real estate units to the customers, the Company has recognized revenue of '' 14,515.59 Lakhs for the year ended 31st March, 2025 and '' 7,557.21 Lakhs for the year ended 31st March, 2024.

49. Forbes Technosys Limited (FTL) a subsidiary were facing serious challenges in terms of operations and due to continuing losses and withdrawal of support from its operational creditors to provide further credit on outstanding dues and non-receipt of its dues by its trade receivables a corporate insolvency resolution process (âCIRPâ) under Section 10 of the Insolvency and Bankruptcy Code 2016 has been initiated by the FTL voluntarily vide application filed before the NCLT on 20th February, 2024. Consequently, the National Company Law Tribunal, Mumbai Bench (NCLT), vide its order dated 24th March, 2025 has admitted the petition filed by FTL. As a result, the Corporate Insolvency Resolution Process (CIRP) has been initiated, the Interim Resolution Professional (IRP) has been appointed with effect from the date of the Order.

Based on above order, the Company does not have any significant influence or control over Forbes Technosys Limited and therefore it is being reclassified from investments and advances in subsidiary to other investments. Further, Investments made and advances given in Forbes Technosys Limited are fully provided in earlier years and further advances given has been provided immediately in the same year.

The Company has granted loans & advances to Forbes Technosys Limited (FTL) of '' 114.00 Lakhs for obligation of bank guarantees during the year ended 31st March, 2024 which was fully provided as the recoverability was doubtful. The Company has received an amount of '' 54.00 Lakhs out of '' 114.00 Lakhs during the year ended 31st March, 2024 the said amount of '' 54.00 Lakhs received has been reversed in the year ended 31st March, 2024 and the net provision for the loans and advances of '' 60.00 Lakhs has been provided as at 31st March, 2024. Further, the Company has received the balance amount of '' 60.00 Lakhs during the quarter ended 30th September, 2024. Accordingly, the balance provision is reversed during the quarter ended 30th September, 2024.

Further, the Company has granted '' 10.00 Lakhs for the quarter ended 31st December, 2024 and '' 2.00 Lakhs for the quarter ended 31st March, 2025 as a loans and advances and the same has been provided during the quarter ended 31st December, 2024 and 31st March, 2025 respectively. Accordingly, net amount of '' 48.00 Lakhs reversed during the year ended 31st March, 2025.

50. A) The Company has taken over certain receivable of Forbes Facility Services Private Limited (FFSPL) in terms of agreement for sale was executed on 20th May, 2022 with SILA Solutions Private Limited for sale of entire stake in FFSPL. The Company has received an amount of '' 115.00 Lakhs in the month of January 2024 on settlement of legal disputes between FFSPL and customers against the previously withheld amount of '' 240.00 Lakhs. The provision made earlier on account of legal disputes is reversed to the extent of '' 115.00 Lakhs and recognized as gain in the profit & loss account for the financial year ended 31st March, 2024.

B) The Company was holding 50% shareholding in Forbes Concept Hospitality Services Private Limited (FCHSPL), a Joint Venture of the Company. The Board of Directors of the Company at their meeting held on 3rd August, 2023 has approved sale of its 60% shareholding in FCHSPL, to Metamix Technologies Private Limited and balance 40% shareholding to Floral Finance Private limited for a consideration of '' 0.03 Lakh and ''0.02 Lakh respectively. Pursuant to the said sale of the entire shareholding in FCHSPL, it has ceased to be a Joint Venture of the Company effective from 3rd August, 2023.

The Company has made provision for doubtful debts amounting to '' 18.00 Lakhs in earlier years with respect to Forbes Concept Hospitality Services Private Limited (FCHSPL). The Company has received the said loan & advances from FCHSPL and accordingly the provision made in earlier years is now reversed and recognized as a gain in profit & loss account during the quarter ended 31st December, 2023 and year ended 31st March, 2024.

C) The Company has made a provision of '' 559.05 Lakhs of property tax as at 31st March, 2024 against the demand raised by MCGM for payment of additional property tax of '' 1,034.34 Lakhs (including penalties) for the retrospective period from April 2010 to March 2023. The balance amount of '' 475.29 Lakhs which is in the nature of penalties are shown as contingent liability. The MCGM has changed the subzone of property from 0014 to 0027 for determination of property tax. The

property valuation in Subzone 0027 is much higher compared to the subzone 0014. The subject property is historically valued in Subzone 0014 for property tax. The Company has disputed the entire demand notice.

D) The Company has impaired the investment made in Forbes Macsa Private Limited for an amount of '' 250.00 Lakhs during the quarter and year ended 31st March, 2025.

51. Scheme of Arrangement

The Board of Directors of the Company (FCL or the "Demerged Company) and Forbes Precision Tools and Machine Parts Limited ("FPTL" or the "Resulting Company") in their respective meetings held on 26th September 2022 approved the Scheme of Arrangement ("Scheme") between the Company and FPTL as well as their respective shareholders in accordance with Sections 230 to 232 of the Companies Act 2013 and other applicable provisions and rules. This Scheme entails the demerger of the "Precision Tools business" from the Company into FPTL with an appointed date of 1st April, 2023.

The Honorable National Company Law Tribunal ("NCLT") of the Mumbai bench approved the scheme via Order No. C.P.(CAA)/303/MB-V/2023 dated 9th February 2024. The certified true copy of the order was received on 22nd February, 2024 and filed with the Registrar of the Company on 1st March, 2024. The Scheme became effective / operative from the effective date of 1st March, 2024 with this the Precision Tools business of FCL being transferred to and vested in FPTL with effect from the appointed date i.e. 1st April, 2023. The FPTL is ceased to be a subsidiary w.e.f. 1st March, 2024.

As a result of the demerger, the Company has applied a reasonable estimate, based on available financial data and managementâs judgment, to determine the tax allocation for the comparative quarters of earlier year i.e. 31st December, 2023. This approach ensures a fair presentation of the financial results. The results for the comparative quarter and nine months ended December, 2023 have been restated.

52. The Company & MACSA ID S.A. entered in to Joint Venture agreement dated 5th December, 2022 and invested equally in Forbes Macsa Private Limited for carrying out business of providing permanent marking and coding solutions. The Joint Venture was operating in losses due to its initial phase of business and establishment cost incurred. The Joint Venture partner MACSA

ID S.A. was unwilling to continue as a Joint Venture. It was mutually decided by the JV Partner to terminate the Joint Venture Agreement. The Joint Venture Agreement was terminated and the entire shareholding of MACSA ID S.A. in the Forbes Macsa Private Limited has been acquired by the Company. Accordingly, Forbes Macsa Private Limited is wholly owned subsidiary of the Company with effect from 31st March, 2025.

53. Forbes Lux International AG (FLIAG), a subsidiary of the Company, along with its subsidiary Lux International AG (LIAG) and step-down subsidiaries, were facing with a severe liquidity crisis for the past several years. Given the ongoing losses and financial difficulties, the management of FLIAG, LIAG, and Lux Schweiz AG submitted an application on 11th April, 2023 seeking a provisional debt restructuring moratorium from the Bulach District Court in Wallissellen, Switzerland. By an order dated 17th April, 2023, the court granted a provisional moratorium, which will be in effect for four months, until 17th August, 2023, to facilitate the restructuring of these companies. A Provisional Administrator was appointed to assess the prospects for this restructuring. The Provisional Administrator submitted the final report to the Court on 2nd August, 2023. Based on the Administratorâs final report, the Court determined that FLIAG, being a pure holding company that hasnât generated any income for a considerable period and has ceased its operational activities, is not viable. Similarly, Lux Schweiz AG has also discontinued its operational activities and income generation, leading to the decision to initiate bankruptcy proceedings for these companies. As for LIAG, the court has granted an extension of the moratorium period until 1st December, 2023. Consequently, FLIAG and Lux Schweiz have been declared bankrupt by an order dated 14th August, 2023.

Subsequently, following due process, the bankruptcy officials issued a publication on 8th September, 2023, announcing the closure of the bankruptcy proceedings due to lack of assets unless a creditor requests implementation within a specified 10-day period. Since no opposition was filed with the Bankruptcy Officer during the stipulated timeline, Forbes Lux International AG, in Liquidation and Lux Schweiz AG, in Liquidation were liquidated and dissolved. In the context of FLIAGâs bankruptcy proceedings, Lux International AG, in Liquidation (LIAG), a subsidiary of FLIAG, has been disposed of by the bankruptcy official. Consequently, FLIAG and its subsidiaries are no longer considered subsidiaries of the Company.

54. As per the Ministry of Corporate Affairs (MCA) notification, proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014, for the financial year commencing April 1,2023, every company which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in the books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled. The interpretation and guidance on what level edit log and audit trail needs to be maintained evolved during the year and

continues to evolve. The Company has used accounting software (viz. Tally Prime) for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, there are no instances of audit trail feature being disabled at any time during the year. The audit trail has been preserved as per the statutory requirements for record retention.

55. The Indian Parliament has approved the Code on Social Security, 2020 (âthe codeâ) which, inter alia, deals with employees benefits during employment and post-employment. The code has been published in the Gazette of India. The effective date of the code is yet to be notified and the rules for quantifying the financial impact are also yet to be issued. In view of this, the impact of change, if any, will be assessed and recognised post notification of the relevant provisions.

56. Additional Regulatory Information as per Schedule III of the Division II of the Companies Act, 2013

i. Details of benami property held

There are not any proceedings that have been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder as at 31st March, 2024.

ii. Wilful defaulter

The Company has not been declared wilful defaulter by any bank or financial Institution or other lender who has powers to declare a company as a wilful defaulter at any time during the financial year or after the end of reporting period but before the date when financial statements are approved or in an earlier period and the default has continued for the whole or part of the current year.

iii. Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

iv. The Company is in compliance with the number of layers prescribed under clause (87) of section 2 of the Companies Act 2013 read with Companies (Restriction on number of Layers) Rules, 2017.

v. (a) The company has not advanced or loaned or invested

any funds (either borrowed funds or share premium or any other sources or kind of funds)during the year to any other person(s) or entity(ies), including foreign entities (intermediaries) with the understanding (whether recorded in writing or otherwise) that the intermediary shall:

i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or,

ii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

(b) The company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) during the year with the understanding (whether recorded in writing or otherwise) that the company shall:

i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

ii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

vi. Undisclosed income

The company does not have any transaction that are not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961), during the year.

vii. Details of crypto currency or virtual currency

The group has not traded or invested in crypto currency or virtual currency during the current or previous year.

viii. Valuation of PP&E, intangible asset and investment property

The group has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

57. Other regulatory information

i. Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

ii. Utilisation of borrowings availed from banks and financial institutions

The borrowings obtained by the company from banks and financial institutions have been applied for the purposes for which such loans were was taken.

iii. The Company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India.

The Group has seven CICs which are part of the Group

- SP Finance Private Limited,

- SC Finance and Investments Private Limited,

- Hermes Commerce Private Limited,

- Renaissance Commerce Private Limited and

- Shapoorji Pallonji Energy Private Limited (formarly known as Shapoorji Pallonji Oil and Gas Private Limited).

- SMCM Holdings Private Limited (SMCM) and

- Shayrus Ventures Private Limited (Shayrus).

58. Previous year figures have been regrouped/ reclassified, wherever necessary to conform to current year classification.

59. The financial statements were approved by the Board of Directors of the Company at their respective meetings held on 30th April, 2025.

Mar 31, 2024

xi) Provisions and Contingent Liabilities

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

Onerous Contracts

Present obligations arising under onerous contracts are recognised and measured as provisions. An onerous contract is considered to exist where the Company has a contract under which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received from the contract.

Contingent liability is disclosed for (i) Possible obligations that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or (ii) Present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made, unless the possibility of outflows of resources embodying economic benefits are remote.

xii) Revenue recognition

Revenue towards satisfaction of a performance obligation is

measured at the amount of transaction price (net of variable

consideration) allocated to that performance obligation.

The Company applies the five-step approach for recognition

of revenue:-

â¢ Identification of contract(s) with customers;

â¢ Identification of the separate performance obligations in the contract;

â¢ Determination of transaction price;

â¢ Allocation of transaction price to the separate performance obligations; and

â¢ Recognition of revenue when (or as) each performance obligation is satisfied.

1 Sale of goods:

Further the amount of revenue can be measured reliably and it is probable that the economic benefits associated with the transaction will flow to the entity.

The transaction price of goods sold and services rendered is net of variable consideration on account of various discounts and schemes offered by the Company as part of the contract.

A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

At contract inception, since for most of the contracts it is expected that the period between the transfer of the promised goods or services to a customer and payment for these goods or services by the customer will be one year or less, practical expedient in IND AS 115 have been applied and accordingly:

a) The Company does not adjust the promised amount of consideration for the effects of a significant financing component

b) The Company recognises the incremental costs of obtaining a contract as an expense when incurred

c) No information on remaining performance obligations as of the year end that have an expected original term of one year or less was reported.

A contract liability is the Companyâs obligation to transfer goods or services to a customer, for which the Company has already received consideration from customers.

2 Interest and Dividend Income:

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the amortised cost and at the effective interest rate applicable.

Dividend income from investments is recognised when the shareholderâs right to receive payment has been established (provided that it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably).

3 Export Incentives:

Income from export incentives is recognised on accrual basis to the extent the ultimate realisation is reasonably certain.

4 Revenue from real estate contracts:

In respect of real estate development projects undertaken by the Company, the control of real estate units is said to be satisfied over time, if any one of the following criteria is met:

a) the customer simultaneously receives and consumes the benefits provided by the entityâs performance as the entity performs

b) the entityâs performance creates or enhances an asset that the customer controls as the asset is created or enhanced

c) the entityâs performance does not create an asset with an alternative use to the entity and the entity has an enforceable right to payment for performance completed to date

In all other cases, where the above criterias for satisfaction of performance obligation and recognising revene over time are not met, revenue would be recognised when control of the real estate units has been transferred and there is no unfulfilled obligation which could affect the customerâs acceptance of the real estate units. Considering the terms of the contract, revenue is recognised at a point in time when:

â¢ The Company has transferred to the customer all significant

risk and rewards of ownership and the Company retains no effective control of the real estate unit to a degree usually associated with ownership;

â¢ The Company has handed over possession of the real estate unit to the customer or deemed possession based on the contract with the customer;

â¢ No significant uncertainty exists regarding the amount of consideration that will be derived from the sale of the real estate unit;

â¢ It is not unreasonable to expect ultimate collection of revenue from customer

Revenue is measured as the fair value of consideration which the Company expects to be entitled to in exchange of transferring the property to the customer (excluding amounts collected on behalf of third parties e.g. taxes). Revenue is recognized with respect to executed sales contracts on transfer of control of the real estate units to the customers

xiii) Foreign currency transactions and balances

In preparing the financial statements of the Company, transactions in currencies other than the Companyâs functional currency viz. Indian Rupee are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date.

Exchange differences on monetary items are recognised in the Statement of Profit and Loss in the period in which they arise.

Non-monetary items that are measured in terms of historical costs in a foreign currency are not retranslated.

xiv) Lease accounting

As a lessee:

From 1 April 2019, leases are recognized as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Company. Contracts may contain both lease and non lease components. The Company allocates the consideration in the contracts to the lease and nonlease components based on their relative standalone prices. However, the Company has elected not to separate lease and non-lease components and instead account for these as a single lease components.

Assets and liabilities arising from a lease are initially measured on present value basis. Lease liabilities include the net present value of the following lease payments:

- fixed payments (including in substances fixed payments), less any lease incentive receivable

- variable lease payments that depend on an index or a rate,initially measured using the index or rate as at the commencement date;

- any residual value guarantees provided to the lessor by the lessee, a party related to the lessee or a third party unrelated to the lessor that is financially capable of discharging the obligations under the guarantee;

- the exercise price of the purchase option if the Company is reasonably certain to exercise that option, and

- payments of penalties for terminating the lease, if the lease term reflects the Company exercising that option

Lease payments to be made under reasonably certain extension option are also included in the measurement of the liability. The lease payments are discounted using the lesseeâs incremental borrowing rate, being the rate that lessee would have to pay to borrow the fund necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar term, security and conditions.

To determine the incremental borrowing rate, the Company:

- where possible, uses recent third party financing received by the lessee as a starting point, adjusted to reflects changes in financing condition since third party financing received

- use a build-up approach that starts with the risk-free interest rate adjusted for credit risk for leases, which does not have recent third party financing, and

- make adjustments specific to the leases, e.g. term, security, currency etc.

The Company is exposed to potential future increases in variable lease payments based on index or rate, which are not included in the lease liability until they take effect. When adjustment to lease payments based on index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset.

Lease payments are allocated between principal and finance cost. Finance cost is charged to Statement of Profit and Loss over the lease period so as to produce a constant periodical rate of interest on the remaining balance of the liability for each period.

Right-of-use assets are measured at cost comprising the following:

- the amount of initial measurement of lease liability

- any lease payments made at or before the commencement date less any lease incentives received

- any initial direct costs, and

- restoration costs

Right-of-use assets are generally depreciated over the shorter of the assetâs useful life and the lease term on a straight line basis. If the Company is reasonably certain to exercise purchase option, the right-of-use asset is depreciated over the underlying assetâs useful life.

Payments associated with short-term leases of equipment and all leases of low-value assets are recognized on a straight-line basis in the Statement of Profit and Loss. Short term leases are leases with a lease term of 12 months or less.

As a lessor:

Lease income from operating leases where the Company is a lessor is recognized in income on a straight line basis over the lease term. Initial direct costs incurred in obtaining an operating leases are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the balance sheet based on their nature. The Company did not need to make any adjustments to the accounting for assets held as a lessor as a result of adopting the new leasing standard.

xv) Taxes on Income

Tax expense for the year, comprising current tax and deferred tax, are included in the determination of the net profit or loss for the year. Current tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. In addition, deferred tax liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax are recognised in the Statment of Profit and Loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. The Company recognises Minimum Alternate Tax credit under the Income Tax Act, 1961 as an asset only when and to the extent there is convincing evidence that the Company will be liable to pay normal income tax during the specified period.

xvi) Government grants

Government grants are not recognised until there is reasonable assurance that the Company will comply with the conditions attaching to them and that the grants will be received. These are recognised in the Statement of Profit and Loss on a systematic basis over the period in line with the related costs.

xvii) Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets, which are assets that necessarily takes a substantial period of time to get ready for its intended use or sale, are added to the cost of those assets; until such time as the assets are substantially ready for their intended use or sale.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in the Statement of Profit and Loss in the period in which they are incurred.

xviii) Segment Reporting

An operating segment is a component of the Company that engages in business activities from which it may earn revenue and incur expenses, whose operating results are regularly reviewed by the Companyâs chief operating decision maker in order to effectively allocate the Companyâs resources and assess performance.

xix) Non-current assets held for sale

Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the asset (or disposal group) is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such asset (or disposal group) and its sale is highly probable. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.

Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell.

Non-current assets are not depreciated or amortised while they are classified as held for sale.

xx) Cash and cash equivalents

For the purpose of presentation in the Statement of Cash Flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the Balance Sheet.

xxi) Exceptional Items

Exceptional items reflect items which individually or, if of a similar type, in aggregate, are disclosed separately due to their size or incidence in order to obtain clear and consistent presentation of the Companyâs performance.

3. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

3.1 Critical judgements in applying accounting policies

The following are the critical judgements, apart from those involving estimations (see note 3.2 below), that the directors have made in the process of applying the accounting policies and that have the most significant effect on the amounts recognised in the financial statements.

3.1.1. The Svadeshi Mills Company Limited (Svadeshi) is not an associate of the Company although the Company owns a 23% ownership interest (including indirect) in Svadeshi, as the Assets of Svadeshi continue to be in the hands of the Official Liquidator, High Court, Bombay. The Review Petition had been filed against the Order dated 23rd February, 2016 whereby the Special Leave Petition (SLP) was dismissed. The said Review Petition filed before the Honâble Supreme Court was dismissed vide Order dated 26th August, 2016. The records of Svadeshi are in the custody of the Official Liquidator. Hence, the Company does not have significant influence over Svadeshi as Svadeshi is under liquidation.

3.2 Key sources of estimation uncertainty

3.2.1 Real Estate Development

The determination of the period over which revenue from real estate development activities should be recognized, the timing of transfer of control to the customer; and determination of whether the Company has an enforceable right to payment as per requirements of Ind AS 115 involves significant judgement.

3.2.2 Contingent Liabilities and Provisions

Contingent Liabilities and Provisions are liabilities of uncertain timing or amount and therefore in making a reliable estimate of the quantum and timing of liabilities judgement is applied and re-evaluated at each reporting date.

3.2.3 Useful life and residual value of Property, Plant and Equipment (including investment properties)

As described in Note 2(iv) and 2(vi), the Company reviews the estimated useful life and residual values of property, plant and equipment at each reporting date.

3.2.4 Fair value measurement and valuation process

Some of the Companyâs assets and liabilities are measured at fair value for financial reporting purposes. The management of the Company determines the appropriate valuation techniques and inputs for fair value measurements. In estimating the fair value of an asset or a liability, the company uses market-observable data to the extent it is available. Where such inputs are not available, the Company engages third party qualified valuers to perform the valuation.

3.2.5 Impairment

Determining whether an asset is impaired requires as estimation of fair value/value in use. Such valuation requires the Company to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. Where the actual future cash flows are less than expected, a material impairment loss may arise.

3.2.6 Impairment of Trade Receivables

âThe impairment provisions for trade receivables are based on assumptions about risk of default and expected loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Companyâs past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

3.2.7 Defined Benefit Obligations

The present value of defined benefit obligations is determined by discounting the estimated future cash outflows by reference to market yields at the end of reporting period that have terms approximating to the terms of the related obligation.

3.2.8 Deferred Tax Asset

Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. The Company recognises Minimum Alternate Tax credit under the Income Tax Act, 1961 as an asset only when and to the extent there is convincing evidence that the Company will be liable to pay normal income tax during the specified period.

4. ADOPTION OF NEW AND AMENDED INDIAN ACCOUNTING STANDARDS

(i) New and amended standards adopted by the Company

Ministry of Corporate Affairs (MCA), vide notification dated 31st March, 2023, has made the following amendments to Ind AS which are effective 1st April, 2023:

a. Amendments to Ind AS 1, Presentation of Financial Statements where the companies are now required to disclose material accounting policies rather than their significant accounting policies

b. Amendments to Ind AS 8, Accounting policies, Changes in Accounting Estimates and Errors where the definition of âchange in account estimateâ has been replaced by revised definition of âaccounting estimateâ.

c. Amendments to Ind AS 12, Income Taxes where the scope of Initial Recognition Exemption (IRE) has been narrowed down

Based on preliminary assessment, the Company does not expect these amendments to have any significant impact on its standalone financial statements.

(ii) New amendments issued but not effective

Ministry of Corporate Affairs (âMCAâ) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended 31st March, 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

6.1 Fair value measurement of the Companyâs investment properties

The fair value of the Companyâs investment properties as at 31st March, 2024 and 31st March, 2023 have been arrived at on the basis of a valuation carried out as on the respective dates by VS.Modi, independent valuer not related to the Company. VS. Modi is registered with the authority which governs the valuers in India, and has appropriate qualifications and recent experience in the valuation of properties in the relevant locations. The fair value was determined based on the market comparable approach that reflects recent transaction prices for similar properties as well as other lettings of similar properties in the neighbourhood. In estimating the fair value of the properties, the highest and best use of the properties is their current use. Thus, the significant unobservable inputs are recent transaction price, taking into account the differences in location, and individual factors, such as frontage and size, between the comparables and the properties. Details of the Companyâs investment properties and information about the fair value hierarchy as at 31st March, 2024 and 31st March, 2023 are as follows:

Retained Earnings: Retained earnings represent the amount of accumulated earnings of the Company

Securities premium reserve: The amount received in excess of the par value of equity shares has been classified as securities premium.

Capital Redemption Reserve: As per Companies Act, 2013, capital redemption reserve is created when company purchases its own shares out of free reserves or securities premium. A sum equal to the nominal value of the shares so purchased is transferred to capital redemption reserve. The reserve is utilised in accordance with the provisions of section 69 of the Companies Act, 2013.

Capital Reserve: During merger, the excess of net assets acquired, over the cost of consideration paid is treated as capital reserve.

34. Employee Benefits :

Brief description of the Plans:

Gratuity

The Companyâs Gratuity Plan is administered by an insurer and the Investments are made in various schemes of the trust. The Company funds the plan on a periodical basis.

Provident Fund

The Company actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from the employee benefit obligations, with the objective that assets of the provident fund obligations match the benefit payments as they fall due.

Post retirement medical and non-compete fees

These plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk. Investment risk

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields

at the end of the reporting period on government bonds. Plan investment is a mix of investments in government securities, and other debt instruments.

Interest risk

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the planâs investments.

Longevity risk

Salary risk

L. Provident Fund

35.3 Market Risk

35.4 Credit risk management Trade receivables

Investments in subsidiaries, associates and joint ventures

Other Financial assets

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are mutual funds and banks with high credit-ratings assigned by credit-rating agencies.

In addition, the Company is exposed to credit risk in relation to the financial guarantees by way of Corporate Guarantee/ Fixed Deposit as a security given to banks on behalf of subsidiaries by the Company. The Companyâs maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on is ''Nil as at 31st March, 2024 (Previous year as at 31st March, 2023 is '' 69.33 Lakhs). Based on expectations at the end of the reporting period, the Company considers that it is more likely that such an amount will not be payable under the arrangement. However, this estimate is subject to change depending on the probability of the counterparty claiming under the guarantee which is a function of the likelihood that the financial receivables held by the counterparty which are guaranteed suffer credit losses.

35.5 Liquidity Risk

35.6 Derivatives Instruments and unhedged Foreign Currency (FC) exposure

40. Segment reporting

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

Details of product categories included in each segment comprises:

Real Estate includes income from renting out investment properties and revenue from real estate development project.

Unallocable Corporate Assets mainly comprises of investments, tax receivables and other unallocable assets.

Unallocable Liabilities comprise borrowings, provisions and other unallocable liabilities not identifiable to any specific segment.

48. Ind AS 115 âRevenue from Contracts with Customersâ, a new accounting standard notified by the Ministry of Corporate Affairs (MCA) on 28th March, 2018 was effective from accounting period beginning on or after 1st April, 2018 and replaced the existing revenue recognition standards. The application of Ind AS 115 had a significant bearing on the Companyâs accounting for recognition of revenue from real estate development projects. Considering the terms of the contract, receipt of Occupancy Certificate for Phase II of the real estate development project, issuance of possession letters and transfer of control of the real estate units to the customers, the Company has recognized revenue of '' 7,557.00 Lakhs for the year ended 31st March 2024 and '' 238.00 Lakhs for the year ended 31st March 2023.

49. The board of directors of Forbes Technosys Limited (FTL) have pursuant to provisions of Section 230 to 232 applied to the National Company Law Tribunal (NCLT) for merger of Forbes Campbell Service Limited (âFCSLâ) and FTL for a consideration of '' 3.00 Lakhs effective 1st October, 2021 and also proposed for reduction in the share capital of FTL. The NCLT, in its order dated 16th September 2022 (âthe Orderâ) approved the Composite Scheme of Arrangement for amalgamation of Forbes Campbell Service Limited (âFCSLâ) into FTL and reduction of share capital of FTL. The appointed date of the Scheme was 1st October 2021, and the scheme has been effective from 29th September, 2022 i.e., the last date on which the certified copy of the order was filed with the Registrar of Companies. Pursuant to the scheme, the Company has written off the investment of ''13,183.00 Lakhs and provision created for the investment amounting to '' 13,183.00 Lakhs is reversed in the year ended 31st March 2023.

The Company has made provision for doubtful trade & contractual receivable amounting to '' 3.00 Lakhs for the quarter ended 31st March 2023 and '' 22.00 Lakhs for the year ended 31st March 2023 with respect to FTL.

The Company has made a provision for doubtful debts on loans & advances given to the following companies: -

a) Forbes Technosys Limited (FTL) - In view of continuing losses in FTL, the Company has made a provision for obligation of bank guarantees of ''114.00 Lakhs for the quarter ended 31st December, 2023. The Company had given '' 60.00 Lakhs (Net) Lakhs as an Inter Corporate Deposit for Settlement of Bank Guarantees obligations. The net amount of '' 54.00 Lakhs has been reversed in the quarter ended 31st March, 2024 in view of FTL has completed its Bank Guarantee obligations. The provision for obligation of Bank guarantees and loan and advances of FTL for the year ended 31st March, 2023 was '' 401.00. Lakhs.

b) Forbes Concept Hospitality Services Private Limited (FCHSPL): The Company has made a provision for loans and advances amounting to '' 18.00 Lakhs for the quarter ended 31st March, 2023 as the recoverability of loan was doubtful.

Accordingly, the total provision for the loans and advances of '' 60.00 Lakhs has been provided as at 31st March, 2024 was '' 419.00 Lakhs for 31st March, 2023.

50. Forbes Technosys Limited (FTL), a subsidiary, is facing serious challenges in terms of operations and due to continuing losses and withdrawal of support from its operational creditors to provide further credit on outstanding dues and non-receipt of its dues by its trade receivables, a corporate insolvency resolution process (âCIRPâ) under Section 10 of the Insolvency and Bankruptcy Code, 2016 has been initiated by the FTL voluntarily vide application filed before the NCLT on 20th February, 2024. The hearing of the said application is awaited.

51. A) The Board of Directors of the Company, in their meeting

held on 22nd December, 2020, approved entering into a Memorandum of Understanding (âMOUâ) for sale of approximately 3.804 acres of land at Chandivali. Accordingly, the net carrying value aggregating ''2,315.70 Lakhs [including '' 2,277.08 Lakhs paid towards seeking permission under the Urban Land (Ceiling & Regulation) Act, 1976 for the transfer/ sale/ development/ redevelopment of the land during quarter ended 31st March, 2022], has been reflected as asset held for sale as on 31st March, 2022.

Pursuant to the Board of Directors meeting dated 24th March, 2022, the Company has entered into a new Agreement for Sale (AFS) for the aforesaid land, with Equinix India Private Limited (Equinix) for an aggregate consideration of '' 23,500.00 Lakhs, which was executed on 24th March, 2022 and the completion of the said transaction was subject to fulfilment of conditions precedent.

The transaction for sale of Chandivali land with Equinix got concluded on 28th June 2022 post completion of the conditions precedent and the Company received entire consideration of '' 23,500.00 Lakhs during the year ended 31st March, 2023. The difference between the net disposal proceeds and the carrying amount of the land amounting to '' 20,684.00 Lakhs has been recognized as gain on disposal for the year ended 31st March, 2023 and reflected in other income in these financial results. The capital gains tax impact of the aforesaid transaction has been appropriately considered during the year ended 31st March, 2023.

B) The Board of Directors of the Company, in their meeting held on 26th May 2023, approved for sale of approximately 0.53 acres of land at Chennai for an aggregate consideration of '' 15 Crores. The transaction got concluded on 1st June, 2023 by executing sale deed in favour of the buyer. Accordingly, the difference between the net disposal proceeds and the carrying amount of the land amounting to '' 1,447.00 Lakhs has been recognized as gain on disposal during the quarter ended 30th June, 2023 and the year ended 31st March, 2024 and reflected in other income in these financial results. The capital gains tax impact of the aforesaid transaction has been appropriately considered during the quarter ended 30th June, 2023 and the year ended 31st March, 2024.

C) The Board of Directors of the Company at their meeting held on 23rd February, 2022 has approved entering into a binding term sheet for the sale of its entire shareholding in Forbes Facility Services Private Limited (FFSPL), a wholly-owned subsidiary of the Company to SILA Solutions Private Limited. This binding term sheet was executed on 23rd February, 2022 and agreement for sale was executed on 20th May, 2022. The transaction was completed on 1st July, 2022 a sales consideration of '' 4,200.00 Lakhs. The Company has received the consideration of '' 3,960.00 Lakhs after deduction of '' 240.00 Lakhs for the legal disputes with multiple customers. The difference between the net disposal proceeds and the carrying amount of investment and expenditure incurred on the transactions and provision made on account of the obligations undertaken by the company under the agreement for sale the net amount of ''

3.202.00 Lakhs was recognized as gain on disposal for the year ended 31st March, 2023 and reflected in Exceptional items in these financial results.

The capital gains tax impact of the aforesaid transaction was appropriately considered in the year ended 31st March, 2023. Additionally, as per the terms of the agreement to sale, the Company has taken over current receivables and payable balances of FFSPL to/ from related parties aggregating '' 122.00 Lakhs and '' 237.00 Lakhs respectively and receivable from non-related party amounting to '' 114.00 lakhs is received by the Company from FFSPL.

During the quarter ended 31st December 2023, the Company has received an amount of '' 74.00 Lakhs and ''

41.00 Lakhs in the month of January, 2024 on settlement of legal disputes between FFSPL and customers against the previously withheld amount of '' 240.00 Lakhs. The provision made earlier on account of legal disputes is reversed to the extent of '' 115.00 Lakhs and recognized as gain in the profit & loss account.

D) The Board of Directors of the Company, at their meeting held on 30th May 2022, have approved the sale of the entire shareholding in SPFSL. The Company has sold

3,75,000 equity shares of '' 10 each and 2,21,50,000 Zero Percent Redeemable Preference Shares of '' 10 each of SPFSL to M/s G.S Enterprises, a related party for an aggregate purchase consideration of '' 2,900.00 Lakhs during the year ended 31st March, 2023. The net carrying value of the investments in SPFSL as at the date of sale was '' 2,756.00 Lakhs and consequently, the Company has recognized an exceptional gain of '' 144.00 Lakhs for the year ended 31st March, 2023.

E) The Company was holding 50% shareholding in Forbes Concept Hospitality Services Private Limited (FCHSPL), a Joint Venture of the Company. The Board of Directors of the Company at their meeting held on 3rd August, 2023 has approved sale of its 60% shareholding in FCHSPL, to Metamix Technologies Private Limited and balance 40% shareholding to Floral Finance Private limited for a consideration of '' 0.03 Lakh and ''0.02 Lakh respectively. Pursuant to the said sale of the entire shareholding in FCHSPL, it has ceased to be a Joint Venture of the Company effective from 3rd August, 2023.

F) The Company has made a provision of '' 559.00 Lakhs of property tax against the demand raised by MCGM for payment of additional property tax of '' 1,034.00 Lakhs (including penalties) for the retrospective period from April, 2010 to March, 2023. The balance amount of '' 475.29 Lakhs which is in the nature of penalties are shown as contingent liability. The MCGM has changed the subzone of property from 0014 to 0027 for determination of property tax. The property valuation in Subzone 0027 is much higher compared to the subzone 0014. The subject property is historically valued in Subzone 0014 for property tax. The Company has disputed the entire demand notice.

G) The Indian Parliament has approved the Code on Social Security, 2020 (âthe codeâ) which, inter alia, deals with employees benefits during employment and postemployment. The code has been published in the Gazette of India. The effective date of the code is yet to be notified and the rules for quantifying the financial impact are also

yet to be issued. In view of this, the impact of change, if any, will be assessed and recognised post notification of the relevant provisions.

52. Scheme of Arrangement

The Board of Directors of the Company (FCL or the âDemerged Company) and Forbes Precision Tools and Machine Parts Limited (âFPTLâ or the âResulting Companyâ) in their respective meetings held on 26th September 2022, approved the Scheme of Arrangement (âSchemeâ) between the Company and FPTL, as well as their respective shareholders, in accordance with Sections 230 to 232 of the Companies Act, 2013, and other applicable provisions and rules. This Scheme entails the demerger of the âPrecision Tools businessâ from the Company into FPTL, with an appointed date of 1st April, 2023.

The Honorable National Company Law Tribunal (âNCLTâ) of the Mumbai bench approved the scheme via Order No. C.P.(CAA)/303/MB-V/2023 dated 9th February, 2024. The certified true copy of the order was received on 22nd February, 2024 and filed with the Registrar of the Company on 1st March 2024. The Scheme became effective / operative from the effective date of 1st March, 2024, with this, the Precision Tools business of FCL being transferred to and vested in FPTL with effect from the appointed date i.e., 1st April, 2023.

Upon the coming into effect of the Scheme, the existing investment in shares capital of FPTL, amounting to '' 5.00 lakhs divided into 50,000 shares of '' 10 each, fully paid up, prior to the Scheme becoming effective, shall stand cancelled without any further application, act, instrument, or deed, as an integral part of this Scheme, with adjustments done through General reserve of the Company. As per the Composite Scheme of Arrangement, the Resulting Company has issued four fully paid-up equity shares of '' 10/- each for every one fully paid-up equity share of '' 10/- each held by the equity shareholders of the Demerged Company (FCL) as of the Record Date, which was 7th March, 2024. The shareholders of the Company (FCL) are entitled to receive 4 shares of FPTL against each share held by them. The record date for allotment was fixed as 7th March, 2024, and the issuance and allotment of equity shares took place on 13th March, 2024. From the appointed date, the precision tools business of FCL, including all its assets and liabilities is transferred and vested to FPTL in accordance with this Scheme. FPTL is in process of listing of its shares with BSE Limited.

From the appointed date, the precision tools business of FCL, including all its assets and liabilities is transferred and vested to FPTL in accordance with this Scheme, Consequently, the deferred tax liability related to those assets and liabilities will be remeasured and will result in a direct charge of '' 234.44 Lakhs to the opening balance of retained earnings of FPTL.

Pursuant to the demerger, the book value of assets and liabilities transferred under the scheme of arrangement as on appointed date are listed below:

Further, the net impact of certain assets and liabilities transferred from the Company to FPTL is resulting in net payable of '' 881.93 Lakhs to Forbes Precision Tools Limited (FPTL). Details of which are as follows:

53. The Company and MACSA ID, S.A., have entered into a 50:50 Joint Venture Agreement on 5th December, 2022 (JVA) for providing innovative laser marking and traceability solutions for the entire range of materials metal and non-metals. Pursuant to the terms of the JVA, a joint venture company viz., FORBES MACSA PRIVATE LIMITED has been incorporated on 9th December, 2022.

54. Forbes Lux International AG (FLIAG), a subsidiary of the Company, along with its subsidiary Lux International AG (LIAG) and step-down subsidiaries, has been facing with a severe liquidity crisis for the past several years. Given the ongoing losses and financial difficulties, the management of FLIAG, LIAG, and Lux Schweiz AG submitted an application on 11th April, 2023, seeking a provisional debt restructuring moratorium from the Bulach District Court in Wallissellen, Switzerland. By an order dated 17th April, 2023, the court granted a provisional moratorium, which will be in effect for four months, until 17th August, 2023, to facilitate the restructuring of these companies. A Provisional Administrator was appointed to assess the prospects for this restructuring. The Provisional Administrator submitted the final report to the Court on 2nd August, 2023. Based on the Administratorâs final report, the Court determined that FLIAG, being a pure holding company that hasnât generated any income for a considerable period and has ceased its operational activities, is not viable. Similarly, Lux Schweiz AG has also discontinued its operational activities and income generation, leading to the decision to initiate bankruptcy proceedings for these companies. As for LIAG, the court has granted an extension of the moratorium period until 1st December, 2023. Consequently, FLIAG and Lux Schweiz have been declared bankrupt by an order dated 14th August, 2023.

55. As per the Ministry of Corporate Affairs (MCA) notification, proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014, for the financial year commencing April 1, 2023, every company which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in the books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled. The interpretation and guidance on what level edit log and audit trail needs to be maintained evolved during the year and continues to evolve.

In Forbes & Copmany Limited, the audit trail is implemented at the application level across all tables and fields to facilitate the maintenance of financial records and relevant transactions. However, the global standard ERP used by the Company has not been enabled with the f

Mar 31, 2023

6.1 Fair value measurement of the Companyâs investment properties

The fair value of the Companyâs investment properties as at 31^st March, 2023 and 31^st March, 2022 have been arrived at on the basis of a valuation carried out as on the respective dates by V.S.Modi, independent valuer not related to the Company. V.S. Modi is registered with the authority which governs the valuers in India, and has appropriate qualifications and recent experience in the valuation of properties in the relevant locations. The fair value was determined based on the market comparable approach that reflects recent transaction prices for similar properties as well as other lettings of similar properties in the neighbourhood. In estimating the fair value of the properties, the highest and best use of the properties is their current use. Thus, the significant unobservable inputs are recent transaction price, taking into account the differences in location, and individual factors, such as frontage and size, between the comparables and the properties. Details of the Companyâs investment properties and information about the fair value hierarchy as at 31^st March, 2023 and 31^st March, 2022 are as follows:

(i) Investment properties (Cost) include jointly owned Residential Premises including land with carrying amount '' 1,551.52 Lakhs (Previous year '' 1,551.52 Lakhs) and Shares in Co-operative Housing Societies, Association of apartment owners and in a company aggregating '' 0.17 Lakh (Previousyear '' 0.17Lakh).

(ii) Investment properties includes the rights in respect of the land and building at Fort, Mumbai with net carrying value of

1. Pursuant to NCLT and Bombay High Court approval vide order dated 21^st January, 2022 for capital reduction in Shapoorji Pallonji Forbes Shipping Limited (âSPFSLâ), 2,01,25,000 equity shares of '' 10 each and 87,50,000 preference shares of '' 10 each were cancelled.

Further, SPFSL has incurred a loss of '' 879.84 Lakhs during the previous year ended 31^st March, 2022 and SPFSL has sold some of its shipping vessels on which exceptional loss was incurred in the previous as well as in 31^st March, 2021. As at the previous year-end only one ship remains and has been sold. Consequently, the recoverable value from use/ sale of the remaining vessels in SPSFL is lower as compared to the carrying value of the investment in SPFSL and an impairment provision of '' 791.41 Lakhs and '' 3,305.13 Lakhs respectively for the previous quarter and previous year ended 31^st March, 2022 has been recorded as an exceptional expense.

Further, the Board of Directors of the Company at their meeting held on 23^rd February, 2022 has approved the termination of the Joint Venture Agreement between Shapoorji Pallonji Forbes Shipping Limited (âSPFSLâ), Sterling Investment Corporation Private Limited and G. S. Enterprises dated 1^st December, 2014 with effect from close of business hours on 28^th February, 2022. Consequently, w.e.f. 1^st March, 2022, SPFSL ceases to be a subsidiary of the Company and now stands as an associate.

The Board of Directors of the Company at their meeting held on 30^th May, 2022 has approved the sale of its entire shareholding in SPFSL, an associate as at 31^st March, 2022 of the Company. Accordingly, the net carrying value of the investment of '' 2,756.09 Lakhs has been classified as asset held for sale as at 31^st March, 2022.

During one of the earlier year the Board of Directors of the Company had given their acceptance for a scheme of Capital reduction in Shapoorji Pallonji Forbes Shipping Limited (âSPFSLâ), a subsidiary of the Company whereby 1,95,00,000 equity shares of '' 10 each were to be cancelled out of aggregate investment of 4,00,00,000 equity shares held by the Company. A petition was filed by SPFSL in the High Court of Judicature at Bombay on 2^nd September, 2016. The scheme was approved by the Honorable Bombay High Court vide order dated 2^nd December, 2016. Accordingly, the Company has recognized '' 1,931.50 Lakhs as loss on capital reduction of investment in equity shares and correspondingly, reversed the existing provisions of '' 2,380.00 Lakhs. The same was disclosed as an exceptional item in the Statement of Profit and Loss for the year ended 31^st March, 2017.

2. Forbes Container Line Pte. Ltd., Singapore (âFCLPLâ), a foreign subsidiary of the Company has been ordered to be wound by the High Court of Republic of Singapore on 19^th August, 2016. An official liquidator has been appointed by the court. The Company has made full provision for investments made and loans given to FCLPL. Accordingly, this entity is no longer a related party for the Company and not consolidated in these financial statements.

3. Edumetry Inc., USA, a foreign joint venture of the Company has been dissolved vide Certificate of Dissolution dated 28^th October, 2015

issued by the State of Delaware. Consequently, the Company does not have any significant influence or control over Edumetry Inc. as on date. Accordingly, this entity is no longer a related party for the Company and not consolidated in these financial statements. The Company has made full provision for these investments in earlier years.

Trade receivables of '' 4,061.21 Lakhs (Previous year '' 3,803.24 Lakhs) were impaired. The individually impaired receivables were mainly due to unexpected difficult economic situations.

Rights, preferences and restrictions attached to equity shares

* The impacts of the reserves taken over as a result of the merger as per the composite scheme of arrangement (Refer note 53), have been determined to the extent practically identifiable by the Company.

During the quarter ended 30th September 2022, the Company has paid Special interim dividend of '' 65/- per fully paid equity share of '' 10 each for financial year 2022-23 after completing all the necessary compliances.

Description of Reserves

Retained Earnings: Retained earnings represent the amount of accumulated earnings of the Company

Securities premium reserve: The amount received in excess of the par value of equity shares has been classified as securities premium.

Capital Reserve: During merger, the excess of net assets acquired, over the cost of consideration paid is treated as capital reserve.

35. Employee Benefits :Brief description of the Plans:

Gratuity

The Company provides for gratuity payable to employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service.

The Companyâs Gratuity Plan is administered by an insurer and the Investments are made in various schemes of the trust. The Company funds the plan on a periodical basis.

Provident Fund

The Company actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from the employee benefit obligations, with the objective that assets of the provident fund obligations match the benefit payments as they fall due.

Post retirement medical and non-compete fees

These plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.

Investment risk

Interest risk

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the planâs investments.

Longevity risk

Salary risk

L. Provident Fund

M. The liability for Compensated absences (Non - Funded) as at year end is '' Nil (Previous year '' 301.62 Lakhs) (Refer Note 19B).

36. Financial Instruments36.1 Capital Management

36.3 Market Risk

The Companyâs activities expose it primarily to the financial risks of changes in foreign currency exchange rates (Refer Note 36.6) and interest rates (Refer Note 36.7). The Company enters into a variety of derivative financial instruments to manage its exposure to foreign currency risk.

36.4 Credit risk management Trade receivables

Investments in subsidiaries, associates and joint ventures

Other Financial assets

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are mutual funds and banks with high credit-ratings assigned by credit-rating agencies.

In addition, the Company is exposed to credit risk in relation to the financial guarantees by way of Corporate Guarantee/ Fixed Deposit as a security given to banks on behalf of subsidiaries by the Company. The Companyâs maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on is '' 69.33 Lakhs as at 31^st March, 2023 (Previous year as at 31^stMarch, 2022 is '' 2,784.10 Lakhs). Based on expectations at the end of the reporting period, the Company considers that it is more likely that such an amount will not be payable under the arrangement. However, this estimate is subject to change depending on the probability of the counterparty claiming under the guarantee which is a function of the likelihood that the financial receivables held by the counterparty which are guaranteed suffer credit losses.

36.5 Liquidity Risk

36.6 Derivatives Instruments and unhedged Foreign Currency (FC) exposure

36.7 Interest rate risk

Interest rate risk results from changes in prevailing market interest rates, which can cause a change in the fair value of fixed-rate instruments and changes in the interest payments of the variable-rate instruments.

d) Valuation Process

The Company engages external valuation consultants to fair value financial instruments measured at FVTPL. The main level 3 inputs used for unlisted equity securities, preference shares and debentures are as follows:

The current market borrowing rates of the Company are compared with relevant market matrices as at the reporting dates to arrive at the discounting rates.

e) Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)

The Company consider that the carrying amounts of financial assets and financial liabilities recognised in Note (a) above approximate their fair values.

37. Operating lease arrangements37.1 (i) The Company as lessor

The Company has entered into operating lease arrangements, consisting of surplus space in buildings to others. The normal tenure of the arrangement is upto five years. The rental income from the assets given on lease of '' 1,555.34 Lakhs (Previous year '' 1,382.56Lakhs) has been disclosed as âRent and amenitiesâ under Revenue from operations in Note 25 to the Statement of Profit and Loss.

b) Other Commitments

The Company has outstanding bank guarantees of '' 156.36 Lakhs (Previous Year '' 115.93 Lakhs).

The Company has outstanding performance guarantees of '' 211.56 Lakhs (Previous Year '' 222.86 Lakhs).

Note:

1. In respect of the above mentioned items, till the matters are finally decided, the timings of outflow of economic benefits cannot be ascertained.

* Excludes guarantees of '' Nil (Previous Year '' 6,190.61 Lakhs) which were taken against loans that have been repaid during the year.

2. The Company has evaluated the impact of the recent Supreme Court Judgment in case of âVivekananda Vidyamandir and Others v/s The Regional Provident Fund Commissioner (II) West Bengalâ and the related circular (Circular No. C-I/1(33)2019/Vivekananda Vidya Mandir/284) dated 20th March, 2019 issued by the Employeesâ Provident Fund Organisation in relation to non-exclusion of certain allowances from the definition of âbasic wagesâ of the relevant employees for the purposes of determining contribution to provident fund under the Employeesâ Provident Funds & Miscellaneous Provisions Act, 1952. In the assessment of the management which is supported by legal advice, the aforesaid matter is not likely to have a significant impact and accordingly, no provision has been made in these Financial Statements.

41. Segment reporting

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

Details of product categories included in each segment comprises:

Engineering Segment includes manufacture/ trading in Precision Cutting Tools, Spring Lock Washers and Marking Systems. The Company caters to the needs of domestic and export markets.

Real Estate includes income from renting out investment properties and revenue from real estate development project.

Unallocable Corporate Assets mainly comprises of investments, tax receivables and other unallocable assets.

Unallocable Liabilities comprise borrowings, provisions and other unallocable liabilities not identifiable to any specific segment.

43. Svadeshi Mills is not considered as a related party of the Company as per Note 3.1.1. Secured Loans include interest free loans granted to The Svadeshi Mills Company Limited, relating to which full provision exists in the financial statements, aggregating '' 4,391.78 Lakhs as at 31^st March, 2023 (31^sMarch, 2022''4,391.78 Lakhs). The Company, being a secured creditor, with adjudicated dues by the Official Liquidator, expects to receive the dues when the matter is ultimately disposed off.

44. The Company had received '' 1,017.04 Lakhs in the year ended 31^st March, 2016 from the Honâble Debt Recovery Tribunal, Mumbai, towards principal and interest for loan given to Coromandel Garments Limited (presently under liquidation).

The Company had made a provision of '' 364.99 Lakhs in earlier years which was reversed on receipt of '' 1,017.04 Lakhs from Coromandel Garments Limited and accounted the balance as interest income during the year ended 31^st March, 2016.

In July 2018, in a separate proceeding the Honâble High Court, Mumbai had directed the Company to refund the aforesaid amount of '' 1,017.04 Lakhs with interest. Consequently, the Company refunded '' 1,055.82 Lakhs [including interest calculated from the date of the order till the date of payment aggregating '' 38.78 Lakhs] and recorded this as an exceptional expense during the year ended 31^st March, 2019. The Company was subsequently directed by the Honâble High Court to pay interest from the date the amount was received by the Company, amounting to '' 276.19 Lakhs (of which the Company had provided for '' 46.00 Lakhs and '' 230.19 Lakhs was disclosed as a contingent liability), which was appealed by the Company.

The Official Liquidator vide order dated 23^rd December, 2019 adjudicated and admitted a claim of '' 744.18 Lakhs (comprising '' 325.00 Lakhs towards loan and '' 419.18 Lakhs as interest).

The appeal filed by the Company with the High Court with respect to the interest of '' 276.19 Lakhs was dismissed on 9^th June, 2021. Thereafter the Official Liquidator filed a report seeking permission from the Honâble High Court, Mumbai for payment of an amount of '' 467.99 Lakhs after adjusting interest amount of '' 276.19 Lakhs from the total adjudicated claim of '' 744.18 Lakhs. The Honâble High Court, vide order dated 4^th August 2021, has permitted the Official liquidator to pay an amount of '' 467.99 Lakhs to the Company within two weeks from the date of the said Order. Basis the above, the Company has provided for '' 230.19 Lakhs in addition to '' 46.00 Lakhs provided earlier and recorded the expense as an exceptional item for year ended 31^st March, 2022. The company has received the aforesaid amount of '' 467.99 Lakhs in the previous year.

(iv) Critical judgements in determining the lease term

For the leases of offices premises, the following factors are normally the most relevant:

l. If there is significant penalties to terminate (or not extend), the Company is typically reasonably certain to extend (or not terminate).

!. If any leasehold improvements are expected to have a significant

remaining value, the Company is typically reasonably certain to extend (or not terminate)

1. Otherwise, the Company considers the other factors including

historical lease duration and the costs and business disruption required to replace the leased asset.

The lease term is reassessed if an option is actually exercised (or not exercised) or the Company becomes obliged to exercise it. The assessment of reasonably certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within control of lessee. During the current financial year, the financial effect of revising lease terms to reflect the effect of exercising extension and termination options was a decrease in lease liabilities and right-of-use assets by '' Nil Lakhs and '' Nil Lakhs respectively (Previous year '' 172.73 Lakhs and '' 145.43 Lakhs respectively).

Lessor accounting as a lessor

The Company did not need to make any adjustments to the accounting for assets held as lessor under operating leases (Refer note 37) as a results of the adoption of Ind AS 116.

For maturity profile of Lease liabilities - Refer Note 36.5.

Certain loans taken by a subsidiary, Forbes Technosys Limited (FTL) are backed by 1^st Pari-passu charge on property owned by the Company situated at Wagle Estate Thane with carrying value amount '' Nil (Previous year '' 0.27 Lakhs).

50. Ind AS 115 âRevenue from Contracts with Customersâ, a new accounting standard notified by the Ministry of Corporate Affairs (MCA) on 28^th March, 2018 was effective from accounting period beginning on or after 1^st April, 2018 and replaced the then existing revenue recognition standards. The application of Ind AS 115 had significant bearing on the Companyâs accounting for recognition of revenue from real estate development projects.

Considering the terms of the contract, receipt of Occupancy Certificate for Phase I of the real estate development project, issuance of possession letters and transfer of control of the real estate units to the customers, the Company has recognised revenue of '' 201.00 Lakhs for the year ended 31^st March, 2023 and '' 1,490.58 lakhs for the year ended 31^s March, 2022.

51. The COVID-19 pandemic has severely disrupted the worldâs business operations due to global lockdown and other emergency measures imposed by the various governments. The operations of the Company were impacted due to the shutdown of plants, real estate development project and offices following the nationwide lockdown. The Company commenced with its operations in a phased manner in line with the directives from the authorities.

utilized for providing the inter-corporate deposits and balance amount of '' 401.00 Lakhs has been provided for the year ended 31^st March 2023. Out of provision of '' 401.00 Lakhs an amount of '' 215.00 lakhs has been provided during the quarter ended 30th June 2022 and balance amount of '' 186.00 Lakhs has been provided during the quarter ended 30th September 2022.

â¢ Provision for inter-corporate deposits (including interest accrued thereon) of '' 4,733.00 Lakhs for the year ended 31^st March, 2022 and provision for guarantees given to FTL (against bank loans availed by FTL) of '' 2,784.00 Lakhs (net of utilization), aggregating to '' 7,517.00 lakhs has been created for the year ended 31^st March 2022. Additionally, inter-corporate deposits given to FTL (including interest accrued thereon) aggregating '' 4,800.00 Lakhs (which were fully provided) has been converted into equity investments during the year ended 31^st March, 2022.

Additionally, inter-corporate deposits given to FTL (including interest accrued thereon) aggregating '' 4,800 Lakhs (which were fully provided) has been converted into equity investments during the year ended 31^st March, 2022.

The board of directors of FTL have pursuant to provisions of Section 230 to 232 applied to the National Company Law Tribunal (NCLT) for merger of Forbes Campbell Service Limited (âFCSLâ) and FTL for a consideration of '' 3 Lakhs effective 1^st October, 2021 and also proposed for reduction in the share capital of FTL. The NCLT, in its order dated 16^th September, 2022 (âthe Orderâ) approved the Composite Scheme of Arrangement for amalgamation of Forbes Campbell Service Limited (âFCSLâ) into FTL and reduction of share capital of FTL. The appointed date of the Scheme was 1^st October, 2021 and the scheme has been effective from 29^th September, 2022 i.e., the last date on which the certified copy of the order was filed with the Registrar of Companies. Pursuant to scheme, the Company has written off the investment of '' 13,183.00 Lakhs and provision created for the investment amounting to '' 13,183.00 Lakhs is reversed in the during the quarter ended 30th September 2022.

53. The Board of Directors of the Company at their Board Meeting held on 8^th September, 2020 had, inter alia, approved the Composite Scheme of Arrangement (âSchemeâ) under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 and the rules and regulations made thereunder.

The Scheme provides for amalgamation and vesting of Aquaignis Technologies Private Limited (âATPLâ) and Euro Forbes Financial Services Limited (âEFFSLâ) [the wholly owned subsidiaries of Eureka Forbes Limited (âEFLâ)] with

The Company has evaluated the impact of this pandemic (considering the current situation and likely future developments along with the expected impact of the new waves and strains of virus in the country) on its business operations, liquidity and recoverability/ carrying values of its assets including property, plant and equipment, trade receivables, inventory and investments as at the Balance Sheet date. Based on the managementâs review of the current indicators and economic conditions, there are no additional adjustments on the Companyâs financial results for the year ended 31^st March, 2023. The Company has adequate unutilized fund-based credit facilities available, to take care of any urgent requirement of funds.

The Company throughout the lockdown period and even subsequently has been able to maintain adequate control of its assets and there are no significant changes to its control environment during the period.

However, the impact assessment of COVID-19 is a continuing process given the uncertainties associated with its nature and duration and accordingly, the impact may be different from that estimated as at the date of approval of these financial results. The Company will continue to monitor any material changes to future economic conditions.

52. Forbes Technosys Limited (FTL), a subsidiary, has incurred a total comprehensive loss of '' 3,384.96 Lakhs for the year ended 31^st March, 2023. Its accumulated losses aggregates to '' 18,276.32 Lakhs and its current liabilities exceeded current assets by '' 11,171.29 Lakhs as at 31^st March, 2023.

FTL has suffered a setback in the last few years due to covid, entry of local players, and also the muted demand and stress in the key sectors that FTL has been traditionally dependent on, such as banking and telecom, has impacted business activities and overall performance of FTL, resulting in FTL realigning its market strategies, exited certain loss making business verticals and focusing on serving customer orders and providing logistics services to customers. Overall, the present situation coupled with the impact of Covid-19 had resulted in a decline in the recoverable value of investment / other assets in FTL, consequent to which an impairment provision / loss allowances as follows have been created:

â¢ The company has made a provision for doubtful trade & contractual receivable amounting to '' 3.00 Lakhs during the quarter ended 31^st March, 2023 and '' 22.00 Lakhs for the year ended 31^st March, 2023.

â¢ The Company has not granted any additional inter corporate deposit during the quarter ended 31^st March 2023. However, the company has granted Inter corporate deposits '' 3,185.00 Lakhs for the year ended 31^st March 2023. Provision created for Guarantees given to FTL by the Company amounting to '' 2,784.00 Lakhs has been

and into EFL and amalgamation and vesting of EFL with and into the Company.

Further, upon the above part of the Scheme becoming effective, Demerger and vesting of Demerged Undertaking (as defined in the Scheme) of the Company into Forbes Enviro Solutions Limited (âFESLâ), on a going concern basis take place in the year ended 31^st March, 2022. Upon the entire scheme becoming effective, the name of FESL shall be changed to Eureka Forbes Limited.

On 19^th September, 2021 a Share Purchase Agreement (SPA) was entered into between Lunolux Limited (Acquirer), an Advent International entity, Shapoorji Pallonji and Company Private Limited (Seller), the Company, EFL, FESL and Forbes Campbell Finance Limited (âFCFLâ) for sale of shares of FESL, post issuance and listing of the same pursuant to the Scheme becoming effective.

Pursuant to the aforesaid SPA, the Board of Directors of the Company vide resolution dated 10^th October, 2021, approved the following amendments to the Scheme:

- certain identified investments of EFL shall not be demerged as part of the Demerged Undertaking (as defined in the Scheme) from the Company to FESL,

- âappointed dateâ as per the Scheme would be effective date or the first day of the calendar month immediately succeeding the month in which the effective date occurs, as may be decided by the Board.

Consequently, notices to equity shareholders, secured creditors and unsecured creditors were sent for the aforesaid modifications in the Scheme and necessary approvals from the stock exchange, regulators and other stakeholders were sought. On 6^th October, 2021, the Company received an order from Honâble National Company Law Tribunal, Mumbai (NCLT) for convening meetings of equity shareholders, secured creditors and unsecured creditors and consequently the meetings were held on 22^nd November, 2021, where the scheme was approved. EFL has deconsolidated FESL w.e.f. 1^st December, 2021. Further, the Scheme was sanctioned by the NCLT vide order dated 25^th January, 2022. Upon receipt of the certified copy of the said order, the Scheme was made effective by filing Form INC 28 with the Registrar of Companies, Mumbai, Maharashtra (ROC) on 1^st February, 2022.

The Board of Directors of the respective companies vide resolution dated 31^st January, 2022 approved 1^st February, 2022 as the Appointed Date, for the purposes of the Scheme. Consequently, with effect from 1^st February, 2022, ATPL and EFFSL have merged with EFL, followed by merger of EFL into the Company and demerger of the Demerged Undertaking on a going concern basis into FESL on the same date.

In accordance with the provisions of the Scheme, each shareholder of the Company as on the Record date i.e. 11^th February, 2022 were allotted 15 shares each of FESL (Now EFL) which got listed on BSE Limited. The allotment of the aforesaid new shares was completed on 14^th February, 2022 and each shareholder of Forbes & Company Limited became entitled to 15 shares of FESL (Now EFL) in the ratio to their original holding as per details specified in the scheme.

Merger

Merger as per the requirements of Appendix C to Ind AS 103 - Business Combinations, should be accounted for as if it had occurred from the beginning of the preceding period in the standalone financial results of the Company. However, in accordance with MCA circular dated 21^st August, 2019, the Company has considered the appointed date i.e. 1^st February, 2022 as the date of merger.

On account of merger, a net liability of '' 13,270.30 lakhs of merged entities as on 1^st February, 2022 (after eliminations of intercompany transactions) which includes Lux Group loans, receivables and liabilities '' 32,905.97 lakhs, was taken over and the investment of the Company in EFL amounting to '' 6,572.86 lakhs has been eliminated.

Demerger

Post the merger scheme becoming effective, Demerger and vesting of Demerged Undertaking (as defined in the Scheme) of the Company into Forbes Enviro Solutions Limited (âFESLâ), on a going concern basis took place on the appointed date of 1^st February, 2022 as approved by the NCLT.

The demerger was considered as a distribution of non-cash assets to the owners of the Company and the difference in the fair value and the carrying amount of net assets of the Demerged Undertaking was recognised as Notional gain on demerger in the financial results for the quarter and year ended 31^st March, 2022 as an exceptional item amounting to '' 4,52,876.26 Lakhs. Neither the Company nor the shareholders have received any cash or were they entitled to receive any cash in respect of this Composite Scheme.

'' in Lakhs
Distribution of demerged undertaking to Shareholders of the Company	4,06,600.00
Carrying value of net assets/ (liabilities) of demerged entities	(46,275.74)
Notional gain on distribution of demerged undertaking to owners	4,52,875.74

The aforementioned merger and demerger have a net impact of '' 26,433.11 Lakhs on reserves as at 31^st March, 2022. The total assets pertaining to the Lux Group retained by the Company in lines with

the Composite Scheme are '' 32,935.67 Lakhs (Refer Note 32 B and

Note 58).

54. A) The Board of Directors of the Company, in their meeting held on 22^nd December, 2020, approved entering into a Memorandum of Understanding (âMOUâ) for sale of approximately 3.804 acres of land at Chandivali. Accordingly, the net carrying value aggregating '' 2,315.70 Lakhs [including '' 2,277.08 Lakhs paid towards seeking permission under the Urban Land (Ceiling & Regulation) Act, 1976 for the transfer/ sale/ development/ redevelopment of the land during quarter ended 31^st March, 2022], has been reflected as asset held for sale as on 31^st March, 2022.

Pursuant to the Board of Directors meeting dated 24^th March, 2022, the Company has entered into a new Agreement for Sale (AFS) for the aforesaid land, with Equinix India Private Limited (Equinix) for an aggregate consideration of '' 23,500.00 Lakhs, which was executed on 24^th March, 2022 and the completion of the said transaction was subject to fulfilment of conditions precedent.

The transaction for sale of Chandivali land with Equinix got concluded on 28^th June, 2022 post completion of the conditions precedent and the Company received entire consideration of '' 23,500.00 Lakhs during the quarter ended 30th June, 2022. The difference between the net disposal proceeds and the carrying amount of the land amounting to '' 20,684.00 Lakhs has been recognised as gain on disposal during the quarter ended 30th June, 2022 and reflected in Other Income in these financial results. The capital gain tax impact of the aforesaid transaction has been appropriately considered during the quarter ended 30th June, 2022 and year ended 31^st March, 2023.

B) The Board of Directors of the Company at their meeting held on 23^rd February, 2022 has approved entering into a binding term sheet for sale of its entire shareholding in Forbes Facility Services Private Limited (FFSPL), a wholly owned subsidiary of the Company to SILA Solutions Private Limited. This binding term sheet has been executed on 23^rd February, 2022 and agreement for sale executed on 20^th May, 2022. The transaction has been completed on 1^st July 2022 a sales consideration of '' 4,200.00 Lakhs. The Company has received the consideration of '' 3,659.00 Lakhs after deduction of '' 240.00 Lakhs for the legal disputes with multiple customers and '' 301.00 lakhs for the fees paid to consultant. The difference between the net disposal proceeds and the carrying amount of investment and expenditure incurred on the transactions and provision made on account of the obligations undertaken by the company under the agreement for sale the net amount of

'' 3,202.00 Lakhs has been recognized as gain on disposal during the quarter ended 30^th September 2022 & year ended 31^st March 2023 and reflected in Exceptional items in these financial results. The capital gains tax impact of the aforesaid transaction has been appropriately considered during the September 2022 quarter & year ended 31^st March 2023.

Additionally, as per the terms of the agreement to sale, the Company has taken-over current receivables and payable balances of FFSPL to/ from related parties aggregating '' 122.00 Lakhs and '' 237.00 Lakhs respectively and receivable from non-related party amounting to '' 54.00 Lakhs and the net amount of '' 60.00 Lakhs is received by the Company from FFSPL. and the same has been paid against payables.

C) The Board of Directors of the Company, at their meeting held on 30th May, 2022, have approved the sale of the entire shareholding in SPFSL. The Company has sold 3,75,000 equity shares of '' 10 each and 2,21,50,000 Zero Percent Redeemable Preference Shares of '' 10 each of SPFSL to M/s G.S Enterprises, a related party for an aggregate purchase consideration of '' 2,900.00 Lakhs during the year ended 31^st March, 2023. The net carrying value of the investments in SPFSL (reflected as asset held for sale on 31^st March, 2022) as at the date of sale was '' 2,802.00 Lakhs and hence the Company has recognised an exceptional gain of '' 98.00 Lakhs during the year ended 31^st March, 2023.

55. The Board of Directors of the Company in their meeting dated 26^th September, 2022 have approved the Scheme of Arrangement (âSchemeâ) between the Company (âFCLâ or the âDemerged Companyâ) and Forbes Precision Tools and Machine Parts Limited (âFPTLâ or the âResulting Companyâ) and their respective shareholders under Section 230 to 232 of the Companies Act, 2013 and other applicable provisions and the Rules framed thereunder. This Scheme is a Scheme of Arrangement involving demerger of âPrecision Tools businessâ of the Company into Forbes Precision Tools and Machine Parts Limited.

The Scheme is subject to necessary approvals by the Stock Exchanges, Securities and Exchange Board of India, Shareholders and Creditors of the Company, as may be applicable, Jurisdictional Bench of National Company Law Tribunal (âNCLTâ) and such other statutory and regulatory approvals as may be required.

The relevant documents for obtaining approval under Regulation 37 of the SEBI Listing Regulations are submitted to the Designated Stock Exchange.

FPTL has been incorporated on 30th August 2022 as a wholly owned subsidiary of the Company.

56. The Company and MACSA ID, S.A., have entered into a 50:50 Joint Venture Agreement on December 5, 2022 (JVA) for providing innovative laser marking and traceability solutions for the entire range of materials metal and non-metals. Pursuant to the terms of the JVA, a joint venture company viz., Forbes Macsa Private Limited has been incorporated on December 9, 2022.

57. Forbes Campbell Finance Limited (FCFL), a subsidiary, has early redeemed 0.1% Optionally Convertible Redeemable Debentures at face value of '' 10 each for year ended 31^st March, 2022. The difference between the carrying amount of the debentures aggregating '' 524.51 Lakhs and the amount received from FCFL aggregating '' 1,728.00 Lakhs has been recognized as income received on early redemption from FCFL (i.e. '' 1,203.49 Lakhs) for the year ended 31^st March, 2022 and recorded as an exceptional item.

58. Lux group is part of the Health and Hygiene business segment of the Group and was earlier part of the Eureka Forbes group of subsidiaries. Pursuant to the demerger of the major Health and Hygiene business in lines with the composite scheme (refer Note 53) from the Group, synergies which were expected to bring about business expansion and recovery for Lux Group might not be attainable. Accordingly, based on an assessment of the revised future projections carried out by the Companyâs management after considering current economic conditions and trends and estimated future operating results, an impairment loss of '' 32,935.67 Lakhs has been recorded as an exceptional item for the quarter and year ended 31^st March, 2022 towards:

â¢ Loans outstanding of '' 10,173.52 Lakhs for the year ended 31st March, 2022.

â¢ Financial assets aggregating '' 20,033.38 Lakhs for the year ended 31^st March, 2022

â¢ Non-current assets '' 272.80 Lakhs for the year ended 31^st March, 2022,

â¢ Trade Receivables '' 2,455.97 Lakhs for the year ended 31^st March, 2022.

59. Additional Regulatory Information as per Schedule III of the Division II of the Companies Act, 2013

i. Details of benami property held

ii. Wilful defaulter

iii. Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

iv. The Company is in compliance with the number of layers prescribed under clause (87) of section 2 of the Companies Act 2013 read with Companies (Restriction on number of Layers) Rules, 2017.

v. (a) The company has not advanced or loaned or invested

i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or,

ii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

(ii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

vi. Undisclosed income

vii. Details of crypto currency or virtual currency

The group has not traded or invested in crypto currency or virtual currency during the current or previous year.

viii. Valuation of PP&E, intangible asset and investment property

The group has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

60. Other regulatory information

i. Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

ii. Utilisation of borrowings availed from banks and financial institutions

The borrowings obtained by the company from banks and financial institutions have been applied for the purposes for which such loans were was taken.

iii. The Company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. The Group has five CICs which are part of the Group

- SP Finance Private Limited,

- SC Finance and Investments Private Limited,

- Hermes Commerce Private Limited,

- Renaissance Commerce Private Limited and

- Shapoorji Pallonji Energy Private Limited (formarly known as Shapoorji Pallonji Oil and Gas Private Limited).

61. Previous year figures have been regrouped/ reclassified, wherever necessary to conform to current year classification.

62. The financial statements were approved by the Board of Directors of the Company at their respective meetings held on 26^th May, 2023.

Mar 31, 2018

1. GENERAL INFORMATION

Forbes & Company Limited (âthe Companyâ) is one of the oldest companies of the world that is still in existence. The Company traces its origin to the year 1767 when John Forbes of Aberdeenshire, Scotland started his business in India. Over the years, the Management of the Company moved from the Forbes Family to the Campbells to the Tata Group and now finally to the well known Shapoorji Pallonji Group. Its parent and ultimate holding company is Shapoorji Pallonji and Company Private Limited. The Company is mainly engaged in Engineering and Real estate business and is listed on the Bombay Stock Exchange. The address and registered office and principal place of business are disclosed in the Annual Report.

2. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the accounting policies, which are described in note 2, the directors of the Company are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

2.1 Critical judgements in applying accounting policies

2.1.1. The Svadeshi Mills Company Limited (Svadeshi) is not an associate of the Company although the Company owns a 23% ownership interest (including indirect) in Svadeshi, as the Assets of Svadeshi continue to be in the hands of the Official Liquidator, High Court, Bombay. The Review Petition had been filed against the Order dated 23rd February, 2016 whereby the Special Leave Petition (SLP) was dismissed. The said Review Petition filed before the Honâble Supreme Court was dismissed vide Order dated 26th August, 2016. The records of Svadeshi are in the custody of the Official Liquidator. Hence, the Company does not have significant influence over Svadeshi as Svadeshi is under liquidation.

2.2 Key sources of estimation uncertainty

2.2.1 Real Estate Development

In case of Real estate development, the Companyâs revenue recognition and margin recognition policy, which are set out in Note 2(xvii), are critical to how the Company values the work it has carried out in each financial year and corresponding recognition of revenue and expenses. These policies require forecasts to be made of the outcomes of long-term real estate development services, which require assessments and judgements to be made mainly on sale considerations, changes in the plan/outlay of work and changes in costs.

2.2.2 Contingent Liabilities and Provisions

2.2.3 Useful life and residual value of Property, Plant and Equipment and Investment Properties

As described in Note 2(iv) and 2(vi), the Company reviews the estimated useful life and residual values of property, plant and equipment and investment properties at each reporting date.

2.2.4 Fair value measurement and valuation process

2.2.5 Impairment

Determining whether an asset is impaired requires an estimation of fair value/value in use. Such valuation requires the Company to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. Where the actual future cash flows are less than expected, a material impairment loss may arise.

The carrying amount of investment in Forbes Technosys Limited, a subsidiary, as at 31st March, 2018 Rs.6,913.00 Lakhs (as at 31st March, 2017 Rs.5,729.50 Lakhs) and based on the valuation report there is no impairment.

3. STANDARDS ISSUED BUT NOT EFFECTIVE

The Ministry of Corporate Affairs (MCA) notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 (the âRulesâ) on 28th March, 2018. The rules shall be effective from reporting periods beginning on or after April 1, 2018. Amendments to Ind AS as per these rules are mentioned below:

Ind AS 115 - Revenue from Contracts with Customers

Ind AS 115, Revenue from contracts with customers deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entityâs contracts with customers. Revenue is recognised when a customer obtains control of a promised good or service and thus has the ability to direct the use and obtain the benefits from the good or service in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The standard replaces Ind AS 18 Revenue and Ind AS 11 Construction contracts and related appendices. A new five-step process must be applied before revenue can be recognised:

1 Identify contracts with customers

2 Identify the separate performance obligation

3 Determine the transaction price of the contract

4 Allocate the transaction price to each of the separate performance obligations, and

5 Recognise the revenue as each performance obligation is satisfied.

The management is in process of assessing the impact of above amendment. The new standard is mandatory for financial years commencing on or after 1 April, 2018 and early application is not permitted. The standard permits either a full retrospective or a modified retrospective approach for the adoption.

Appendix B to Ind AS 21 - Foreign currency transactions and advance consideration

The appendix clarifies how to determine the date of transaction for the exchange rate to be used on initial recognition of a related asset, expense or income where an entity pays or receives consideration in advance for foreign currency-denominated contracts.

The management is in process of assessing the impact of above amendment, though it is expected that impact from the amendment would not be significant. The Company intends to adopt the amendments prospectively from 1st April, 2018.

Ind AS 40 - Investment property - Transfers of investment property

The amendments clarify that transfers to, or from, investment property can only be made if there has been a change in use that is supported by evidence.

Ind AS 12 - Income taxes regarding recognition of deferred tax assets on unrealised losses

The amendments clarify the accounting for deferred taxes where an asset is measured at fair value and that fair value is below the assetâs tax base.

1. Plant and equipment includes assets that are jointly owned of Rs.10.25 Lakhs.

2. Land and building with a carrying amount of Rs.251.96 Lakhs have been mortgaged by way of pari passu charge to secure borrowings of the Company (Refer Note 17).

3. Plant, equipments, furniture and fixtures and data processing equipments with a carrying amount of Rs.2,089.98 Lakhs have been mortgaged / hypothecated to secure borrowings of the Company (Refer Note 17).

Notes:

(i) Investment properties include premises on freehold land where the Company is yet to be registered as the owner of a proportionate share in the land Rs.28.66 Lakhs (Previous year Rs.28.66 Lakhs), Jointly owned Residential Premises Rs.28.39 Lakhs (Previousyear Rs.28.39 Lakhs) and Shares in Cooperative Housing Societies, Association of apartment owners and in a company Rs.0.17 Lakh (Previous year Rs.0.17 Lakh).

(ii) Building with a carrying amount of Rs.227.24 Lakhs (Previous year Rs.242.62 Lakhs) have been mortgaged to secure credit facilities of the Company.

(iii) Investment properties includes the lease rights in respect of the land and building at Fort, Mumbai with net carrying value of Rs.424.41 Lakhs of which Rs.66.23 Lakhs has been disclosed under property, plant and equipment (Refer Note 5) for which the Company has made an application for renewal of lease and approval from authorities awaited thereon.

4.1 The Company has entered into an agreement for sale of a flat and accordingly the carrying value aggregating Rs.1.98 Lakhs (Previous year â Nil) of the asset has been shown as âAsset classified as held for saleâ on the face of Balance Sheet . The fair value of the said asset is Rs.130 Lakhs.

4.2 Fair value measurement of the Companyâs investment properties

The fair value of the Companyâs investment properties as at 31st March, 2018 and 31st March, 2017 have been arrived at on the basis of a valuation carried out as on the respective dates by V.S.Modi and Yardi Prabhu, independent valuers not related to the Company. V.S. Modi and Yardi Prabhu are registered with the authority which governs the valuers in India, and they have appropriate qualifications and recent experience in the valuation of properties in the relevant locations. The fair value was determined based on the market comparable approach that reflects recent transaction prices for similar properties as well as other lettings of similar properties in the neighbourhood. In estimating the fair value of the properties, the highest and best use of the properties is their current use. Thus, the significant unobservable inputs are recent transaction price, taking into account the differences in location, and individual factors, such as frontage and size, between the comparables and the properties. Details of the Companyâs investment properties and information about the fair value hierarchy as at 31st March, 2018 and 31stMarch, 2017 are as follows:

1. During the previous year the Board of Directors of the Company had given their acceptance for a scheme of Capital reduction in Shapoorji Pallonji Forbes Shipping Limited (âSPFSLâ), a subsidiary of the Company where by 1,95,00,000 equity shares of Rs.10 each were to be cancelled out of aggregate investment of 4,00,00,000 equity shares held by the Company. A petition was filed by SPFSL in the High Court of Judicature at Bombay on 2nd September, 2016. The scheme was approved by the Honorable Bombay High Court vide order dated 2nd December, 2016. Accordingly, Company has recognized Rs.1,931.50 Lakhs as loss on capital reduction of investment in equity shares and correspondingly, reversed the existing provisions of Rs.2,380.00 Lakhs. The same has been disclosed as an exceptional item in the Statement of Profit and Loss for the year ended 31st March, 2017 (Refer Note 32B).

2. The Board of Directors of the Company at its meeting held on 12th October, 2016, had approved sale of its entire shareholding (50.001%) in Shapoorji Pallonji Bumi Armada Offshore Limited (fomerly known as Forbes Bumi Armada Offshore Limited), a joint venture with Bumi Armada Berhad to Shapoorji Pallonji Oil and Gas Private Limited (âSPOGPLâ) at a price of Rs.1,250.00 Lakhs. The Company had executed âShare Transfer Agreementâ and transferred the entire shareholding to SPOGPL and recognized profit of Rs.750.01 Lakhs during the previous year. The same has been disclosed as an exceptional item in the Statement of Profit and Loss for the year ended 31st March, 2017 (Refer Note 32B).

3. Forbes Container Lines Pte. Ltd., Singapore (âFCLPLâ), a foreign subsidiary of the Company has been ordered to be wound by the High Court of Republic of Singapore on 19th August, 2016. An official liquidator has been appointed by the court. As on 31st March, 2017, Company has made full provision for investments made and loans given to FCLPL. Accordingly, this entity is no longer a related party for the Company and not consolidated in these financial statements.

4. During the year, the terms of the preference shares held in Forbes Technosys Limited have been changed. The existing terms of the preference shares held in Forbes Technosys Limited have been changed to 10% Optionally Redeemable Compulsory Convertible Non Cumulative Preference Shares. The Board has approved the revised term sheet for preference shares issued by Forbes Technosys Limited in the Board Meeting held on 24th May, 2017.

5. Edumetry Inc., USA, a foreign joint venture of the Company has been dissolved vide Certificate of Dissolution dated 28th October, 2015 issued by the State of Delaware. Consequently, the Company does not have any significant influence or control over Edumetry Inc. as on date. Accordingly, this entity is no longer a related party for the Company and not consolidated in these financial statements.

6. The Company has 25% ownership in Shapoorji Pallonji Forbes Shipping Limited (âSPFSLâ) by virtue of joint venture agreement. However, SPFSL is consolidated as a subsidiary due to the Companyâs ability to appoint majority of directors on the Board of SPFSL.

For trade receivables from related parties refer Note 40.

The average credit period on sales is 75 days. No interest is charged on trade receivables overdue. There are no customers who represent more than 5% of the total balance of trade receivables.

Trade receivables of Rs.863.59 Lakhs (Previous year Rs.849.94 Lakhs) were impaired. The individually impaired receivables were mainly due to unexpected difficult economic situations. It was assessed that a portion of these receivables is expected to be recovered.

5. Employee Benefits : Brief description of the Plans:

The Company has various schemes for long term benefits such as Provident Fund, Gratuity, Superannuation, Employees State Insurance Fund (ESIC) and Employeesâ Pension Scheme, Leave Encashment, Post Retirement Medical and Non Compete fees. The Companyâs defined contribution plans are Superannuation, Employees State Insurance Fund and Employeesâ Pension Scheme (under the provisions of the Employeesâ Provident Funds and Miscellaneous Provisions Act, 1952). The Company has no further obligation beyond making the contributions to such plans. The Companyâs defined benefit plans include Provident Fund, Gratuity, Post Retirement Medical and Non Compete fees.

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service.

The gratuity plan is a funded plan and the Company had obtained insurance policies with Life Insurance Corporation of India(LIC) and makes a contribution to LIC for amounts notified by LIC. The Company accounts for gratuity benefits payable in future based on an independent external actuarial valuation carried out at the end of the year using the Projected Unit Credit method.

The Companyâs Gratuity Plan is administered by an insurer and the Investments are made in various schemes of the trust. The Company funds the plan on a periodical basis.

The eligible employees of the Company are entitled to receive post-employment benefits in respect of provident fund, in which both the employees and the Company make monthly contributions at a specified percentage of the employeesâ eligible salary. The contributions are made to the Government Family Pension Fund / provident fund managed by the trust set up by the Company which are charged to the Statement of Profit and Loss as incurred.

A large portion of assets consists of government and corporate bonds, although the Company also invests in equities, cash and mutual funds. The plan asset mix is in compliance with the requirements of the regulations in case of Provident fund.

Under the post-retirement medical, and non-compete fees, eligible whole-time directors and on their demise, their spouses are entitled to medical benefits subject to certain limits and fixed monthly payment as non-compete fee. The Company accounts for these benefits payable in future based on an independent external actuarial valuation carried out at the end of the year using the Projected Unit Credit method.

These plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.

Investment risk

Interest risk

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the planâs investments.

Longevity risk

Salary risk

The above sensitivity analyses are based on change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the balance sheet.

L. Provident Fund

The Company has established âForbes & Company Ltd. Employees Provident Fundâ in respect of all the employees to which both the employee and employer make contribution equal to 12% of the employeesâ basic salary respectively. The Companyâs contribution to the provident fund for all employees, are charged to the Statement of Profit and Loss. In case of any liability arising due to shortfall between the return from its investments and the administered interest rate, the same is required to be provided for by the Company. In accordance with the recent acturial valuation, there is no deficiency in the interest cost as the present value of expected future earnings of the fund is greater than the expected amount to be credited to the individual members based on the expected guaranteed rate of interest.

M. The liability for Compensated absenses (Non - Funded) as at year end is Rs.316.90 Lakhs (Previous year as at year end is Rs.303.66 Lakhs) (Refer Note 19B).

6. Financial Instruments

6.1 Capital Management

The Company determines the amount of capital required on the basis of annual as well as long term operating plans and other strategic investment plans. The funding requirements are met through non convertible debt securities or other long-term /short-term borrowing s. The Company monitors the capital structure on the basis of total debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

6.2 Financial risk management objectives

The Management monitors and manages the financial risks to the operations of the Company. These risks include market risk, credit risk and liquidity risk.

6.3 Market Risk

The Companyâs activities expose it primarily to the financial risks of changes in foreign currency exchange rates (Refer Note 36.6) and interest rates (Refer Note 36.6). The company enters into a variety of derivative financial instruments to manage its exposure to foreign currency risk.

6.4 Credit risk management Trade receivables

Trade receivables are generally unsecured and are derived from revenue earned from customers. On account of adoption of Ind AS 109, the company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix and forward-looking information and an assessment of the credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade receivables. Historical experience of collecting receivables of the Company is supported by low level of past default and hence the credit risk is perceived to be low.

Investments in subsidiaries, associates and joint ventures

The Company had invested in various subsidiaries and associates. The approved future business plans and cash flow projections of the subsidiaries and associates are evaluated by the management of the Company on an ongoing basis and based on this evaluation the recoverability of the investments is considered to be good.

Other Financial assets

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are mutual funds and banks with high credit-ratings assigned by credit-rating agencies.

In addition, the Company is exposed to credit risk in relation to the financial guarantees given to banks on behalf of subsidiaries by the Company. The Companyâs maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on is Rs.18,270.40 Lakhs as at 31st March, 2018 (Previous year as at 31st March, 2017 is Rs.16,920.00 Lakhs). Based on expectations at the end of the reporting period, the Company considers that it is more likely that such an amount will not be payable under the arrangement. However, this estimate is subject to change depending on the probability of the counterparty claiming under the guarantee which is a function of the likelihood that the financial receivables held by the counterparty which are guaranteed suffer credit losses.

6.5 Liquidity Risk

The Company has the following undrawn credit lines available as at the end of the reporting period.

The following tables detail the Companyâs remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the earliest date on which the Company can be required to pay. The tables include both principal and interest cash flows.

6.6 Derivatives Instruments and unhedged Foreign Currency (FC) exposure

Of the above, the Company is mainly exposed to USD, GBP and EUR. Hence the following table analyses the Companyâs Sensitivity to a 5% increase and a 5% decrease in the exchange rates of these currencies against INR.

d) Valuation Process

1) The current market borrowing rates of the Company are compared with relevant market matrices as at the reporting dates to arrive at the discounting rates.

e) Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)

The Company consider that the carrying amounts of financial assets and financial liabilities recognised in Note (a) above approximate their fair values.

7. Operating lease arrangements

7.1(i) The Company as lessor

The Company has entered into operating lease arrangements, consisting of surplus space in buildings to others. The normal tenure of the arrangement is upto five years. The rental income from the assets given on lease of Rs.1,667.76 Lakhs (previous year Rs.1,564.22 Lakhs) has been disclosed as âRent and aminetiesâ under Revenue from operations in Note 25 to the Statement of Profit and Loss.

The details of the premises leased are as follows:

7.1(iii) The Company as lessee

The Company leases various offices and equipments under cancellable operating lease expiring within two to three years. The leases have varying terms, escalation clauses and renewal rights. On renewal, the terms of the leases are renegotiated. Rent expenses relating to operating leases amounting to Rs.278.92 Lakhs (Previous Year Rs.251.89Lakhs).

8. Discontinuing operations

In January 2016, the Board had granted its approval for sale of the Shipping business comprising Container Freight Station (CFS) at Veshvi and Mundra and Logistics Service business on a slump sale basis. The Company also executed an Agreement to transfer assets dated 18th April, 2016 pertaining to its Logistics business and simultaneously completed the transaction. The Company has completed the slump sale of Mundra CFS in April, 2016 and Veshvi CFS in August, 2016. Accordingly, profit for the year ended 31st March, 2017 includes profit on slump sale of Veshvi and Mundra CFS and profit on sale of Logistics business amounting to Rs.5,459.26 Lakhs and Rs.331.01 Lakhs respectively. The same has been considered in profit of discontinued operations in the Statement of Profit and Loss for the year ended 31 st March, 2017.

The following table summarises the financial information relating to discontinuing operation of âShipping & Logisticsâ segment in accordance with the Ind AS 105 on âDiscontinuing Operationsâ.

9. Segment reporting

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

Details of product categories included in each segment comprises:

Engineering Segment includes manufacture/ trading in Precision Cutting Tools, Spring Lock Washers and Marking Systems. The Company caters to the needs of domestic and export markets.

Real Estate includes income from renting out investment properties and revenue from real estate development project.

Unallocable Corporate Assets mainly comprises of investments, tax receivables and other unallocable assets.

Unallocable Liabilities comprise borrowings, provisions and other unallocable liabilities.

10. Svadeshi Mills is not considered as a related party of the Company as per Note 3.1.1. Secured Loans include interest free loans, relating to which full provision exists in books of accounts, aggregating Rs.4,391.78 Lakhs as at 31st March, 2018 (31stMarch, 2017 Rs.4,391.78 Lakhs) granted to The Svadeshi Mills Company Limited. The Company, being a secured creditor, with adjudicated dues by the Official Liquidator, expects to receive the dues when the matter is ultimately disposed off.

11. Details of costs and revenue in respect of Project in progress:

Methods used to determine the project revenue : Percentage Completion Method

Methods used to determine the stage of completion : The proportion that Project costs incurred for work performed upto the Balance Sheet date bear to the estimated total project costs.

12. Particulars of loan given / Investments made / guarantees given, as required by clause (4) of Section 186 of the Companies Act, 2013

13. The real estate development operations under âProject Viciniaâ being executed at a plot of land in the city of Mumbai at Chandivali have been agreed between Forbes and another Company as per the terms of settlement filed with the Honourable Bombay High Court in 2011 for the then existing dispute. Each Company is now independently entitled to 50% of the saleable area and 50% of the rights in the permissible Floor Space Index and also for their own individual development and consequent sale of their respective individual flats for the specified land being developed.

14. As per Indian Accounting Standard 18 on Revenue and Schedule III of the Companies Act, 2013, Revenue from Operations for the period July 1, 2017 to March 31, 2018 does not include Goods and Service Tax (GST), however Revenue from Operations till the period ended June 30, 2017 and for the year ended March 31, 2017 includes Excise Duty. In view of the aforesaid restructuring of indirect taxes, Revenue from Operations for the year ended March 31, 2018 are not comparable with previous year.

15. The Board of Directors of the Company has recommended a dividend of Rs.2.50 (25%) per equity share for the year ended 31st March, 2018. There is no other material subsequent event occurred after Balance Sheet date.

16. Previous year figures have been regrouped/ reclassified, wherever necessary to conform to current year classification.

17. The financial statements were approved by the Board of Directors of the Company at their respective meetings held on 28th May, 2018.

Mar 31, 2017

Footnotes:

1. Buildings (Cost) include: (i) Residential flats and office premises Rs. 69.54 Lakhs (as at 31st March, 2016 Rs. 69.54 Lakhs; as at 1st April, 2015 Rs. 69.54 Lakhs) in respect of which Co-operative societies are yet to be formed; (ii) Shares in Co-operative Housing Societies, Association of apartment owners and in a company Rs. 0.17 Lakh (as at 31st March, 2016 Rs. 0.17 Lakh; as at 1st April, 2015 Rs. 0.17 Lakh); (iii) Premises on freehold land where the Company is yet to be registered as the owner of a proportionate share in the land Rs. 28.66 Lakhs (as at 31st March, 2016 Rs. 28.66 Lakhs; as at 1st April, 2015 Rs. 28.66Lakhs); and (iv) Jointly owned Residential Premises Rs. 28.39 Lakhs (as at 31st March, 2016 Rs. 28.39 Lakhs; as at 1st April, 2015 Rs. 28.39Lakhs).

2. Plant and equipment includes assets that are jointly owned of Rs. 10.25 Lakhs (as at 31st March, 2016 Rs. 10.25 Lakhs; as at 1st April, 2015 Rs. 10.25 Lakhs).

3. Land and building with a carrying amount of Rs. 200.55 Lakhs (as at 31st March, 2016 Rs. 3,015.35 Lakhs; as at 1st April, 2015 '' 3,154.89 Lakhs) have been pledged to secure borrowings of the Company as security for bank loans under a mortgage (see Note 17).

4. Plant, equipments, furniture and fixtures with a carrying amount of '' Rs. 422.43 Lakhs (as at 31st March, 2016 Rs. 689.66 Lakhs; as at 1st April, 2015 Rs. 734.06Lakhs) have been pledged to secure borrowings of the Company as security for bank loans under a mortgage (see Note 17).

5. Fair value measurement of the Company''s investment properties

The fair value of the Companyâs investment properties as at 31st March, 2017, 31st March, 2016, and 1st April, 2015 have been arrived at on the basis of a valuation carried out as on the respective dates by V.S.Modi and Yardi Prabhu, independent valuers not related to the Company. V.S. Modi and Yardi Prabhu are registered with the authority which governs the valuers in India, and they have appropriate qualifications and recent experience in the valuation of properties in the relevant locations. The fair value was determined based on the market comparable approach that reflects recent transaction prices for similar properties as well as other lettings of similar properties in the neighborhood. In estimating the fair value of the properties, the highest and best use of the properties is their current use. Thus, the significant unobservable inputs are recent transaction price, taking into account the differences in location, and individual factors, such as frontage and size, between the comparables and the properties. Details of the Company''s investment properties and information about the fair value hierarchy as at 31st March, 2017, 31st March, 2016, and 1st April, 2015 are as follows:

6. During the year the Board of Directors of the Company had given their acceptance for a scheme of Capital reduction in Shapoorji Pallonji Forbes Shipping Limited (âSPFSLâ), a subsidiary of the Company where by 1,95,00,000 equity shares of Rs. 10 each were to be cancelled out of aggregate investment of 4,00,00,000 equity shares held by the Company. A Company scheme petition was filed by SPFSL in the High Court of Judicature at Bombay on 2nd September, 2016. The scheme was approved by the Honorable Bombay High Court vide order dated 2nd December, 2016. Accordingly, Company has recognized Rs. 1,931.50 Lakhs as loss on capital reduction of investment in equity shares and correspondingly, reversed the existing provisions of '' 2,380.00 Lakhs. The same has been disclosed as an exceptional item in the Statement of Profit & Loss for the year ended 31st March, 2017 (Refer Note 32B).

7. The Board of Directors of the Company at its meeting held on 12th October, 2016, had approved sale of its entire shareholding (50.001%) in Shapoorji Pallonji Bumi Armada Offshore Limited (formerly known as Forbes Bumi Armada Offshore Limited), a joint venture with Bumi Armada Berhad to Shapoorji Pallonji Oil and Gas Private Limited (âSPOGPLâ) at a price of Rs. 1,250.00 Lakhs. The Company has executed âShare Transfer Agreementâ and transferred the entire shareholding to SPOGPL and recognized profit of Rs. 750.01 Lakhs during the year. The same has been disclosed as an exceptional item in the Statement of Profit & Loss for the year ended 31st March, 2017 (Refer Note 32B).

8. Forbes Container Line Pte. Ltd., Singapore (âFCLPLâ), a foreign subsidiary of the Company has been ordered to be wound by the High Court of Republic of Singapore on 19th August, 2016. An official liquidator has been appointed by the court. As on 31st March, 2017, Company has made full provision for investments made and loans given to FCLPL.

The average credit period on sales is 75 days. No interest is charged on trade receivables overdue. The Company has generally recognized an allowance for doubtful debts at 50% against receivables between 180 -365 days and 100% against doubtful receivables and certain receivables over 365 days .

There are no customers who represent more than 5% of the total balance of trade receivables.

Trade receivables disclosed above include amounts (see below for aged analysis) that are past due at the end of the reporting period for which the Company has not recognized an allowance for doubtful debts because there has not been a significant change in credit quality and the amounts are still considered recoverable.

9. Trade receivables Rights, preferences and restrictions attached to equity shares

The Company has only one class of shares referred to as equity shares having a par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

10. The general reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to profit or loss. Note 2:

The Company has issued Redeemable Non-convertible Debentures. Accordingly, the Companies (Share Capital and Debenture) Rules, 2014 (as amended), requires the Company to create Debenture Redemption Reserve out of profits of the Company available for payment of dividend for an amount equal to 25% of the value of debentures issued.

In respect of the year ended 31st March, 2017, the directors in their meeting held on 24th May, 2017, proposed that a dividend of Rs. 2.50 per share be paid on fully paid equity shares. This equity dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements. The proposed equity dividend is payable to all holders of fully paid equity shares. The total estimated equity dividend to be paid is Rs. 322.47 Lakhs. Dividend distribution tax on proposed dividend being Rs. 65.64 Lakhs.

11. Employee Benefits : Brief description of the Plans:

The Company has various schemes for long term benefits such as Provident Fund, Superannuation, Gratuity, Leave Encashment and Post Retirement Medical and Non Compete fees. In case of funded schemes, the funds are recognized by the Income tax authorities and administered through trustees. The Companyâs defined contribution plans are Provident Fund (in case of certain employees), Superannuation, Employees State Insurance Fund and Employeesâ Pension Scheme (under the provisions of the Employeesâ Provident Funds and Miscellaneous Provisions Act, 1952). The Company has no further obligation beyond making the contributions to such plans. The Companyâs defined benefit plans include Gratuity, Post Retirement Medical and Non Compete fees and Leave Encashment.

The gratuity plan is a funded plan and the Company had obtained insurance policies with Life Insurance Corporation of India(LIC) and makes an contribution to LIC for amounts notified by LIC. The Company accounts for gratuity benefits payable in future based on an independent external actuarial valuation carried out at the end of the year using the Projected Unit Credit method.

The Companyâs Gratuity Plan is administered by an insurer and the Investments are made in various schemes of the trust. The Company funds the plan on a periodical basis.

The eligible employees of the Company are entitled to receive postemployment benefits in respect of provident fund, in which both the employees and the Company make monthly contributions at a specified percentage of the employeesâ eligible salary. The contributions are made to the Government Family Pension Fund / provident fund managed by the trust set up by the Company which are charged to the statement of profit and loss as incurred.

The eligible employees of the Company are entitled to receive postemployment benefits in respect of superannuation fund in which the Company makes an annual contribution at a specified percentage of the employeesâ eligible salary. The contributions are made to the LIC. Superannuation is classified as defined contribution plan as the Company has no further obligations beyond making the contribution. The Companyâs contribution to defined contribution plan is charged to the statement of profit and loss as incurred.

Under the post-retirement scheme, eligible whole-time directors and on their demise, their spouses are entitled to medical benefits subject to certain limits and fixed monthly payment as non-compete fee. The Company accounts for these benefits payable in future based on an independent external actuarial valuation carried out at the end of the year using the Projected Unit Credit method.

These plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.

Investment risk

Interest risk

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the planâs debt investments.

Longevity risk

Salary risk

12. The liability for Compensated absences (Non - Funded) as at year end is Rs. 303.66 Lakhs (as at 31st March, 2016 Rs. 355.22 Lakhs and as at 1st April, 2015 Rs. 333.57Lakhs) (Refer Note 19B).

13. Financial Instruments

14. Capital Management

The Company manages its capital to ensure that it will be able to continue as going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance. The capital structure of the Company consists of net debt (borrowings as detailed in Notes 17, 18B and 22 offset by cash and bank balances) and total equity of the Company.

15. Financial risk management objectives

The company monitors and manages the financial risks to the operations of the company. These risks include market risk, credit risk and liquidity risk.

16. Market Risk

The company''s activities expose it primarily to the financial risks of changes in foreign currency exchange rates (see Note 37.7) and interest rates (see Note 37.7 of attached sheet). The company enters into a variety of derivative financial instruments to manage its exposure to foreign currency risk and interest rate risk.

17. Credit risk management

Based on the Company''s monitoring of customer credit risk, the company believes that no impairment allowance is necessary in respect of trade receivables that are not past due or past due but not more than 180 days. Trade receivables consist of a large number of customers and the Company do not have significant credit risk exposure to any single counterparty. Ongoing credit evaluation is performed on the financial conditions of the trade receivables.

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit-rating assigned by credit-rating agencies.

In addition, the Company is exposed to credit risk in relation to the financial guarantees given to banks provided by the Company. The Companyâs maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on is Rs. 16,920.00 Lakhs as at 31st March, 2017 (Previous year as at 31st March, 2016 is Rs. 16,920.00Lakhs and as at 1st April, 2015 is Rs. 16,920 Lakhs). Based on expectations at the end of the reporting period, the Company considers that it is more likely that such an amount will not be payable under the arrangement. However, this estimate is subject to change depending on the probability of the counterparty claiming under the guarantee which is a function of the likelihood that the financial receivables held by the counterparty which are guaranteed suffer credit looses.

18. Liquidity Risk

19. Interest Rate Risk & Sensitivity Analysis

The company is exposed to interest rate risk because it borrows funds at both fixed and floating interest rates.

The sensitivity analyses below have been determined based on the exposure to interest rates for borrowings at the end of the reporting period. For floating rate borrowings the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year and the rates are reset as per the applicable reset dates. The basis risk between various benchmarks used to reset the floating rate borrowings has been considered to be insignificant.

If interest rates had been 100 basis points higher/lower and all other variables were held constant, the Company''s

- Profit for the year ended 31st March, 2017 would decrease/increase by Rs. NIL. This is mainly attributable to the Companyâs exposure to borrowings at floating interest rates.

If interest rates had been 100 basis points higher/lower and all other variables were held constant, the Company''s

- Profit for the year ended 31st March, 2016 would decrease/increase by Rs. 39.97 Lakhs. This is mainly attributable to the Companyâs exposure to borrowings at floating interest rates.

20. Derivatives Instruments and unhedged Foreign Currency (FC) exposure

The Company is exposed to Currency Risk arising from its trade exposures and capital/Loan receipt/payments denominated, in other than the Functional Currency. The Company has a Foreign Exchange Risk Management policy within which the treasury has to perform and also lays down the checks and controls to ensure the continuing success of the treasury function. The Company has defined strategies for addressing the risks for each category of exposures (e.g. for exports , for imports, for loans, etc.). The centralized treasury function aggregates the foreign exchange exposure and takes prudent measures to hedge the exposure based on prevalent macroeconomic conditions.

21. Discontinuing operations

In January 2016, the Board had granted its approval for sale of the Shipping business comprising Container Freight Station (CFS) at Veshvi and Mundra and Logistics Service business on a slump sale basis. The Company also executed an Agreement to transfer assets dated 18th April, 2016 pertaining to its Logistics business and simultaneously completed the transaction. The Company has completed the slump sale of Mundra CFS in April, 2016 and Veshvi CFS in August, 2016. Accordingly, profit for the year ended 31st March, 2017 includes profit on slump sale of Veshvi and Mundra CFS and profit on sale of Logistics business amounting to Rs. 5,459.26 Lakhs and Rs. 331.01 Lakhs respectively. The same has been considered in profit of discontinued operations in the Statement of Profit and Loss for the year ended 31st March, 2017.

22. Under Previous GAAP borrowings were carried at cost and transaction cost were charged to profit and loss as and when incurred. Under Ind AS, transaction cost incurred towards origination of borrowings is required to be deducted from the carrying amount of borrowings on initial recognition. These cost are recognized in the statement of profit and loss over the tenure of the borrowing as part of interest expense by applying effective interest rate method. Accordingly, borrowings for the year ended 31st March, 2016 have been increased by Rs. 17.85 lakhs and reduced by Rs. 55.12 lakhs as at 1st April, 2015.

23. Under previous GAAP, long term investments in preference shares and debentures of subsidiaries (investments) made at below market rate/interest free were measured at cost less diminution in value which is other than temporary. In previous GAAP, there was no specific guidance on accounting for investments in instruments that are below market rate/interest free. Under Ind AS, the cost of below market rate/interest free investments is measured as the difference between their initial carrying amount determined in accordance with Ind AS 109 and the amount of loan given. After initial recognition, the investment has been subsequently carried at fair value through Profit or Loss i.e. interest based on market rate has been recognized as fair value. Thus considering the criteria of Ind AS, the investments have increased by '' 98.62 Lakhs for the year ended 31st March, 2016 and by Rs. 474.40 Lakhs as at 1st April, 2015. The total equity increased by an equivalent amount.

24. Under previous GAAP, there was no specific guidance on accounting for interest free rental deposits. Hence, these were recognized and carried at the amount given. Whereas in Ind AS, the prepaid rent is measured as the difference between the initial carrying amount of the deposit determined in accordance with Ind AS 109 and the amount of deposit given. The Company has given interest free security deposit of Rs. 417.42 Lakhs as on 1st April, 2015 and the fair value on initial recognition is estimated to be Rs. 284.84 Lakhs. The difference of Rs. 132.58 Lakhs has been treated as prepaid rent under Ind AS and is recognized in the statement of profit and loss over the period of lease. After initial recognition, the rental deposit has been subsequently carried at amortized cost i.e. interest based on market rate has been recognized under the effective interest rate method as part of finance cost. The net effect of these changes is an increase in total equity of Rs. 10.86 Lakhs as at 31st March, 2016 and of Rs. 20.05 Lakhs as at 1st April, 2015.

25. Under previous GAAP, premium paid for derivative contracts was amortized over the term of the derivative contracts whereas under Ind AS the derivative contracts are measured at FVTPL. Thus, the unamortized premium as of March 15 has been charged off to retained earnings and Derivative contracts have been recognized at Fair value resulting into net increase in Profit & Loss of Rs. 4.98 Lakhs for the year ended 31st March, 2016. The loss on MTM measurement of forward exchange contracts amount to Rs. 4.60 Lakhs for the year ended 31st March, 2016.

26. Under Ind AS, financial guarantee contracts are accounted as financial liabilities and measured initially at fair value and subsequently at the higher of i) amount of loss allowance determined in accordance with impairment requirements of Ind AS 109 and the amount initially recognized less when appropriate, the cumulative amount of income recognized in accordance with principles of Ind AS 18. Under previous GAAP, these were not recognized in the balance sheet. As these financial guarantee have been given towards loans taken by its group entities, notional financial guarantee commission income has been recognized with the corresponding increase in the investment in the respective group entities resulting into increase in investment by Rs. 59.23 Lakhs as at 31st March, 2016 and Rs. 106.64 Lakhs as at 1st April, 2015 with corresponding increase in Equity.

27. Under previous GAAP, actuarial gain or losses were recognized in profit or loss. Under Ind AS, actuarial gain and losses form part of re-measurement of the net defined benefits liability/asset which is recognized in other comprehensive income. Consequently, the tax effect of the same has also been recognized in other comprehensive income under Ind AS instead of the statement of profit & loss. The actuarial gains for the year ended 31st March, 2016 were Rs. 37.48 lakhs and the tax effect thereon '' Nil. This does not affect total equity, but there is a decrease in profit before tax and in total profit of Rs. 37.48 lakhs for year ended 31st March, 2016.

28. Segment reporting

The "Shipping and logistics services" segment has been discontinued. The Company caters to the needs of the domestic and export markets.

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

29. In respect of loans given to Coromondal Garments Limited, The Company had made full provision amounting to Rs. 364.99 Lakhs in an earlier year and had also stopped accruing interest thereon due to uncertainty as to recoverability of loans and interest, in view of ongoing liquidation process of Coromondal Garments Limited.

Subsequent to the previous year end, on the basis of order passed by the Honâble High Court, Mumbai, the Company has received Rs. 1,017.04 Lakhs from Honâble Debt Recovery Tribunal, Mumbai as part satisfaction of amount due. The amount received by the Company is after setting aside amount for securing the claim of the workmen of the company in liquidation. The companyâs status as a secured creditor is not disputed by the official liquidator.

Considering the above, management is of the view that possibility of amount becoming refundable upon final outcome of this matter is remote. The Company has therefore during the previous year reversed the provision amounting to Rs. 364.99 Lakhs towards the loans and advances and accounted the balance amount of Rs. 652.05 Lakhs as interest income. This has been disclosed as an exceptional item at Note no. 32 B to the statement of profit and loss account of the Company.

30. Secured Loans and advances include interest free loans, relating to which full provision exists in books of accounts, aggregating Rs. 4,391.78 Lakhs as at 31st March, 2017 (31stMarch, 2016 Rs. 4,391.78Lakhs) granted to The Svadeshi Mills Company Limited. The Company, being a secured creditor, with adjudicated dues by the Official Liquidator, expects to receive the dues when the matter is ultimately disposed off.

31. Details of costs and revenue in respect of Project in progress:

Methods used to determine the project revenue : Percentage Completion Method

Methods used to determine the stage of completion : The proportion that Project costs incurred for work performed up to the balance sheet date bear to the estimated total project costs.

32.. The Board of Directors of the Company has recommended a dividend of Rs. 2.50 (25%) per equity share for the year ended 31st March, 2017. There is no other material subsequent event occurred after balance sheet date.

33. The financial statements were approved by the Board of Directors of the Company at their respective meetings held on 24th May, 2017 which concluded on 25 the May, 2017.

Mar 31, 2016

1. Corporate Information

Forbes & Company Limited is one of the oldest companies of the world that is still in existence. The Company traces its origin to the year 1767 when John Forbes of Aberdeenshire, Scotland started his business in India. Over the years, the Management of the Company moved from the Forbes Family to the Campbells to the Tata Group and now finally to the well known Shapoorji Pallonji Group. The Company is mainly engaged in the Engineering, Real estate and Shipping & Logistics business; and is listed on the Bombay Stock Exchange.

2. Capital and other commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.423.04 Lakhs; (Previousyear:Rs.188.61 Lakhs) [against which advance paid aggregating Rs.148.85 Lakhs; (Previousyear:Rs.125.38Lakhs)]

(b) For commitments relating to lease arrangements, see Note 34(a).

The estimates of future salary increases, considered in the actuarial valuation, take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

The contribution expected to be made by the Company during the financial year 2016-17 is Rs.105.18 Lakhs (Previousyear:Rs.101.57Lakhs).

Other Post Retirement Benefits

The information in respect of medical cost trend rates and the effect of an increase / decrease of 1% point in the assumed medical cost trend rates on current service cost, interest cost, accumulated post employment benefit cost and experience adjustment is not available; during the year, medical cost of Rs.1.59 Lakhs (Previousyear:Rs.13.98Lakhs) is recognised to the statement of profit and loss based on actuarial valuation.

The Company has charged amounts aggregating '' (6.46) Lakhs; (Previousyear: Rs.86.33 Lakhs) to the statement of profit and loss based on actuarial valuation [Present value of future obligation as at 31st March, 2016 Rs.350.13 Lakhs; (Previousyear: Rs.411.57Lakhs)] and paid Rs.54.98 Lakhs (Previous year: Rs.58.92Lakhs), towards the post retirement arrangements to former Managing Directors and other Directors.

3. Segment reporting

The Company has identified business segments as its primary segment and geographical segment as its secondary segment. Business segments are primarily "Engineering", "Real estate" and "Energy Solution" segment. The "Shipping and logistics services" segment has been discontinued. The Company caters to the needs ofthe domestic and export markets.

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

4. (a) Related party disclosures

(A) Holding Company

Shapoorji Pallonji and Company Private Limited

(B) Subsidiary Companies

1 Eureka Forbes Limited and its subsidiaries:

a) Aquamall Water Solutions Limited and its subsidiary:

i) Aquadiagnostics Water Research & Technology Centre Limited

ii) Forbes Lux International AG and its subsidiaries:

- Lux International AG and its subsidiary:

- Lux Aqua Gmbh, Switzerland

- Lux Aqua Hungary KFT

- Lux Italia srl

- Forbes Lux Group AG Baar and its subsidiary:

- Lux / Sk / s.r.o

- Lux Schweiz AG

- Lux (Deutschland) GmbH and its subsidiaries:

- Lux Service GmbH

- Lux Norge A/s

- Lux Oesterreich GmbH

- Lux CZ s.r.o

- Lux Hungaria Kereskedelmi Kft

- LIAG Trading & Investment Limited

b) EFL Mauritius Limited

c) Euro Forbes Limited Dubai and its subsidiary:

i) Forbes Lux FZCO

d) Forbes Facility Services Pvt. Limited

e) Forbes Enviro Solutions Limited

f) Euro Forbes Financial Services Limited

2 Forbes Campbell Finance Limited and its subsidiaries

a) Forbes Bumi Armada Limited

b) Forbes Campbell Services Limited

c) Forbes Edumetry Limited ( Under voluntary winding up)

3 Forbes Technosys Limited

4 Forbes Bumi Armada Offshore Limited

5 Forbes Container Lines Pte. Limited and its subsidiary: a) Forbesline Shipping Services LLC

6 Shapoorji Pallonji Forbes Shipping Limited

7 Campbell Properties & Hospitality Services Limited

8 Volkart Fleming Shipping and Services Limited

9 Technext E-Payments & Services Limited (incorporated on 14th July, 2015 and sold on 28th March, 2016)

(C) Fellow Subsidiaries (where there are transactions):

1 Afcons Infrastructure Limited

2 Forvol International Services Limited

3 Gokak Textiles Limited

4 Shapoorji Pallonji Investment Advisors Pvt.Limited

5 Shapoorji Pallonji Oil and Gas Pvt. Limited (earlier known as Cosima Properties Pvt. Limited)

6 Sterling and Wilson Pvt. Limited

7 SP Fabricators Pvt. Limited

8 SP Architectural Coatings Pvt. Limited

(D) Associate Companies (where there are transactions):

1 The Svadeshi Mills Company Limited (refer Note 55)

2 Coromandel Garments Limited (Subsidiary of The Svadeshi Mills Company Limited)

3 Neuvo Consultancy Service Limited

(E) Joint Ventures (where there are transactions):

1 Edumetry Inc (Upto 28th October, 2015)

2 Forbes Aquatech Limited (Joint venture of Eureka Forbes Limited)

3 Nypro Forbes Products Limited (Joint venture of Forbes Campbell Finance Limited) (Upto 23 rd February, 2015)

(F) Key Management Personnel:

Managing Director, Mr. Ashok Barat

5. Leases

(a) Finance lease: Company as lessee

The Company has acquired Computer Hardware under finance lease for three years.

(i) The gross carrying amount and the accumulated depreciation at the balance sheet date are Rs.64.68 Lakhs; (Previousyear: Rs.120.38 Lakhs) and Rs.64.68 Lakhs; (Previousyear:Rs.119.36Lakhs) respectively.

(ii) Depreciation recognised in the statement of profit and loss is Rs.1.02 Lakhs; (Previousyear:Rs.44.71 Lakhs).

Future minimum aggregate lease payments (MLP) under finance leases together with the present value of future lease payments (PV of MLP), discounted at the interest rates implicit in the lease are as follows:

(b) Operating lease: Company as lessor

The Company has entered into operating lease arrangements, consisting of surplus space in buildings to others. The normal tenure of the arrangement is upto three years. The details ofthe premises leased are as follows:

6. Discontinuing operations

In January 2016, the Board had granted its approval for sale of the Shipping & Logistics Services business comprising Container Freight Station (CFS) and Logistics on a slump sale basis.

The CFS division at Veshvi is yet to be transferred for which a definitive agreement is in place.

The Company has completed the slump sale of Mundra CFS in April, 2016. The Company has executed an Agreement to transfer assets dated April 18, 2016 pertaining to its Logistics business and simultaneously completed the transaction.

7. Details of dues to micro and small enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006

The information as required under Micro, Small and Medium Enterprises Development Act, 2006, has been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by Auditors, is as follows:-

8. Secured Loans and advances include interest free loans, relating to which full provision exists in books of accounts, aggregating Rs.4,391.78 Lakhs as at 31st March, 2016 (Previous year: Rs.4,716.78 Lakhs) granted to The Svadeshi Mills Company Limited (Previous year include its subsidiary Coromandel Garments Limited). The Company, being a secured creditor, with adjudicated dues by the Official Liquidator, expects to receive the dues when the matter is ultimately disposed off.

9. In respect of loans given to Coromandel Garments Limited, The Company had made full provision amounting to Rs.364.99 lakhs in an earlier year and had also stopped accruing interest thereon due to uncertainty as to recoverability of loans and interest, in view of ongoing liquidation process of Coromandel Garments Limited.

Subsequent to the year end, on the basis of order passed by Hon''ble High Court, Mumbai, the Company has received Rs.1,017.04 lakhs from Hon''ble Debt Recovery Tribunal, Mumbai as part satisfaction of amount due. The amount received by the Company is after setting aside amount for securing the claim of the workmen ofthe company in liquidation. The company''s status as a secured creditor is not disputed by the official liquidator.

Considering the above, management is of the view that possibility of amount becoming refundable upon final outcome of this matter is remote. The Company has therefore reversed the provision amounting to Rs.364.99 lakhs towards the loans and advances and accounted the balance amount of Rs.652.05 lakhs as interest income. This has been disclosed as an exceptional item at Note no. 28 to the statement of profit and loss account of the Company.

10. Details of costs and revenue in respect ofProject in progress:

Methods used to determine the project revenue : Percentage Completion Method

Methods used to determine the stage of completion : The proportion that Project costs incurred for work performed upto the balance sheet date bear to the estimated total project costs.

11. The Management is in the process of identifying and appointing a Chief Financial Officer as required under Section 203 of the Companies Act, 2013.

12. Assets of The Svadeshi Mills Company Limited (Svadeshi) continued to be in the hands of the Official Liquidator, High Court, Bombay. An application to get Svadeshi out of liquidation was filed with the Hon''ble High Court, Bombay, which was dismissed and the Official Liquidator was directed to proceed expeditiously for winding up of Svadeshi. The Company filed an appeal before the Division Bench which was dismissed. The Company filed a Special Leave Petition (SLP) before Hon''ble Supreme Court (SC) which too was dismissed. Thereafter, a Review Petition has been filed before the Hon''ble Supreme Court and the same is pending hearing. The records of the Svadeshi are in the custody of the Official Liquidator. In view of the current status of the court matter, management has not considered Svadeshi as an associate from the current year.

13. Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classificaton / disclosure.

Mar 31, 2015

1. Corporate Information

Forbes & Company Limited is one of the oldest companies of the world that is still in existence. The Company traces its origin to the year 1767 when John Forbes of Aberdeenshire, Scotland started his business in India. Over the years, the Management of the Company moved from the Forbes Family to the Campbells to the Tata Group and now finally to the well known Shapoorji Pallonji Group. The Company is mainly engaged in the Engineering, Real estate and Shipping & Logistics business; and is listed on the Bombay Stock Exchange.

2. Contingent liabilities:

(a) Claims against the Company not acknowledged as debts

As at As at 31st March, 31st March, 2015 2014 Rs. in Lakhs Rs. in Lakhs

1) Tax matters:-

(i) Excise demand (Advance paid against the demand Rs. 29.36 Lakhs; Previous year Rs. 29.13 Lakhs) 4,774.54 4,723.51

ii) Sales tax (Advance paid against the demand Rs. 225.16 Lakhs; Previous year Rs. 94.91 Lakhs) 2,297.83 809.49

iii) Income-tax (Advance paid against the demand Rs. 1,347.30 Lakhs; Previous year Rs. 981.18 Lakhs) 4,136.46 1,243.88

iv) Service-tax 732.68 691.01

v) Entry-tax (Advance paid Rs. 38.45 Lakhs; Previous year Rs. 38.45 Lakhs) 76.90 38.45

vi) Customs duty (Advance paid Rs. 0.18 Lakhs; Previous year Rs. Nil) 2.00 -

vii) Wealth tax (Advance paid Rs. 14.95 Lakhs; Previous year Rs. 36.12 Lakhs) 14.95 36.12

viii) Property tax 451.61 551.61

2) Labour matters in dispute 9.00 6.00

3) Claim of Madhya Gujarat Vij Co. Ltd. for alleged diversion of fraction of the power consumed and contested by the Company in the Court 188.29 188.29

4) Customer claims (Advance paid against the demand Rs. 50.18 Lakhs; Previous year Rs. Nil) 3,042.26 2,582.93

5) Supplier claims - 15.00

6) Other legal matters 6.20 6.20

(b) Guarantees:-

i) Guarantees given on behalf of Shipping Principals including subsidiary and Surety Bonds jointly executed with third parties in favour of customs and other parties 12,404.50 14,193.93

ii) Guarantee on behalf of a subsidiary company 2,801.55 2,676.52

iii) Corporate Guarantee on behalf of a subsidiary company 16,920.00 11,920.00

Note:

In respect of items mentioned above, till the matters are finally decided, the timing of outflow of economic benefits cannot be ascertained.

3. Capital and other commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 188.61 Lakhs; (Previous year: Rs. 311.72 Lakhs) [against which advance paid aggregating Rs. 125.38 Lakhs; (Previous year: Rs. 114.50 Lakhs)]

(b) For commitments relating to lease arrangements.

(c) The Company has agreed to provide continuing financial support to Forbes Container Lines Pte. Ltd. a wholly owned subsidiary, to meet all its obligation, to the extent the subsidiary is unable to meet its obligations.

Defined-benefits plans:

In terms of the guidance note issued by the Institute of Actuaries of India, the actuary has provided a valuation of provident fund liability based on the assumptions listed below and determined a shortfall of Rs. Nil (Previous year Rs. 10.54 Lakhs) as at 31st March, 2015 and the same is recognised to the statement of profit and loss based on actuarial valuation.

The information in respect of medical cost trend rates and the effect of an increase / decrease of 1% point in the assumed medical cost trend rates on current service cost, interest cost, accumulated post employment benefit cost and experience adjustment is not available; during the year, medical cost of Rs. 4.34 Lakhs (Previous year: Rs. (12.05) Lakhs) is recognised to the statement of profit and loss based on actuarial valuation.

The Company has charged amounts aggregating Rs. 86.33 Lakhs; (Previous year: Rs. 78.29 Lakhs) to the statement of profit and loss based on actuarial valuation [Present value of future obligation as at 31st March, 2015 Rs. 411.57 Lakhs; (Previous year: Rs. 384.17 Lakhs)] and paidRs. 58.92 Lakhs (Previous year: Rs. 53.96 Lakhs), towards the post retirement arrangements to former Managing Directors and other Directors.

4. Segment reporting

The Company has identified business segments as its primary segment and geographical segment as its secondary segment. Business segments are primarily "Engineering", "Shipping and logistics services", "Real estate" and "Energy Solution" segment. The Company caters to the needs of the domestic and export markets.

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

5. (a) Related party disclosures

(A) Holding Company

Shapoorji Pallonji and Company Private Limited (Formerly known as Shapoorji Pallonji and Company Limited)

(B) Subsidiary Companies

1 Eureka Forbes Limited and its subsidiaries:

a) Aquamall Water Solutions Limited and its subsidiary:

i) Aquadiagnostics Water Research & Technology Centre Limited

ii) Forbes Lux International AG and its subsidiary:

- Lux International AG and its subsidiaries:

- Lux del Paraguay S.A (Formerly known as Hogar Paraguay Electrodomesticos S.A)

- Lux Italia srl

- Forbes Lux Group AG Baar and its subsidiary: * Lux / Sk / s.r.o

- Lux Schweiz AG

- Lux (Deutschland) GmbH and its subsidiaries:

* Lux Service GmbH

* Lux Norge A/s

* Lux Oesterreich GmbH

* Lux CZ s.r.o

* Lux Hungaria Kereskedelmi Kft

- LIAG Trading & Investment Limited (w.e.f. 4th February, 2015)

b) EFL Mauritius Limited

c) Euro Forbes Limited Dubai and its subsidiary: i) Forbes Lux FZCO

d) Forbes Facility Services Pvt. Limited

e) Forbes Enviro Solutions Limited

f) Waterwings Equipments Pvt.Ltd.

g) Radiant Energy Systems Pvt.Ltd.

h) Euro Forbes Financial Services Limited

2. Forbes Campbell Finance Limited and its subsidiaries

a) Forbes Bumi Armada Limited

b) Forbes Campbell Services Limited

c) Forbes Edumetry Limited (Under voluntary winding up)

d) Forbes Technosys Limited

3. Forbes Bumi Armada Offshore Limited

4. Forbes Container Lines Pte. Limited and its subsidiary: *

a) Forbesline Shipping Services LLC *

5. Shapoorji Pallonji Forbes Shipping Limited (Formerly known as SCI Forbes Ltd. w.e.f. 1st December, 2014)

6. Campbell Properties & Hospitality Services Limited (w.e.f. 30th December, 2014)

7. Volkart Fleming Shipping and Services Limited

(C) Fellow Subsidiaries (where there are transactions):

1. Afcons Infrastructure Limited

2. Forvol International Services Limited

3. Gokak Textiles Limited

4. Shapoorji Pallonji Investment Advisors Pvt.Limited

5. Shapoorji Pallonji Energy (Gujarat) Pvt. Limited

6. Sterling and Wilson Pvt. Limited

7. SP Fabricators Pvt. Limited

8. SP Architectural Coatings Pvt. Limited

(D) Associate Companies (where there are transactions):

1. The Svadeshi Mills Company Limited

2. Coromondal Garments Limited (Subsidiary of The Svadeshi Mills Company Limited)

3. Neuvo Consultancy Service Limited

(E) Joint Ventures (where there are transactions):

1 Edumetry Inc

2 Nypro Forbes Products Limited (Joint venture of Forbes Campbell Finance Limited) (Upto 23rd February, 2015)

3 SCI Forbes Limited (Now known as Shapoorji Pallonji Forbes Shipping Limited) (Upto 30th November, 2014)

(F) Key Management Personnel:

Managing Director, Mr. Ashok Barat

* For the purpose of Companies Act, 2013, this will be treated as an Associate Company.

6. Leases

(a) Finance lease: Company as lessee

The Company has acquired Office Equipments under finance lease for four years.

(i) The gross carrying amount and the accumulated depreciation at the balance sheet date are Rs. 120.38 Lakhs; (Previous year: Rs. 122.14 Lakhs) and Rs. 119.36 Lakhs; (Previous year: Rs. 76.17 Lakhs) respectively.

(ii) Depreciation recognised in the statement of profit and loss is Rs. 44.71 Lakhs; (Previous year: Rs. 38.01 Lakhs).

7. Derivative instruments and unhedged foreign currency exposures

The Company enters into Foreign Exchange Contracts being derivative instruments, which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date.

8. Loans and advances to related parties includes interest free loans, relating to which full provision exists in books of accounts, aggregating Rs. 4,756.77 Lakhs (Secured Rs. 4,716.78 Lakhs) as at 31st March, 2015 [Previous year: Rs. 4,756.77 Lakhs (Secured Rs. 4,716.78 Lakhs)]granted to The Svadeshi Mills Company Limited and its subsidiary Coromandal Garments Limited. The Company, being a secured creditor, with adjudicated dues by the official Liquidator, expects to receive the dues when the matter is ultimately disposed off.

9. Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

Mar 31, 2014

As at As at 31st March, 31st March, 2014 2013 Rs. in Lakhs Rs. in Lakhs

1. Contingent liabilities:

(a) Claims against the Company not acknowledged as debts

1) Taxes in dispute:-

(i) Excise demand 4,723.51 4,723.51

(ii) Sales tax 809.49 790.54

(iii) Income-tax 1,243.88 1,352.05

(iv) Service-tax 691.01 254.21

(v) Entry-tax 38.45 76.90

(vi) Wealth tax 36.12 36.12

(vii) Property tax 551.61 551.60

2) Labour matters in dispute 6.00 16.50

3) Claim of Madhya Gujarat Vij Co. Ltd. for alleged diversion of fraction of the power consumed and contested by the Company in the Court 188.29 188.29

4) Customer claims 2,582.93 2,404.32

5) Supplier claims 15.00 15.00

6) Other legal matters 6.20 6.20

(b) Guarantees:-

(i) Guarantees given on behalf of Shipping Principals including subsidiary and Surety Bonds jointly executed with third parties in favour of customs and other parties 14,193.93 6,620.00

(ii) Guarantee on behalf of a subsidiary company 2,676.52 3,533.37

(iii) Corporate Guarantee on behalf of a subsidiary company 11,920.00 3,420.00

Note:

In respect of item mentioned above, till the matters are finally decided, the timing of outflow of economic benefits cannot be ascertained.

2. Capital and other commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 311.72 Lakhs; (Previous year: Rs. 424.45 Lakhs) [against which advance paid aggregating Rs. 114.50 Lakhs; (Previous year: Rs. 54.38 Lakhs)]

(b) For commitments relating to lease arrangements, see Note 35(a) and for derivative contracts, see Note 39(a).

(c) The Company along-with other joint venturers, has entered into a "Sponsor Support Deed" with Natixis, Security Trustee, on 15th July, 2011 by which the Company irrevocably and unconditionally undertaken to the Security Trustee and each of other creditors, to the extent of its shareholding (i.e. 25%) in the Borrower, namely SCI Forbes Limited, a joint venture company, to pay dues if the Borrower does not pay or discharge any of its obligations.

(d) The Company has agreed to provide continuing financial support to Forbes Container Lines Pte. Ltd. wholly owned subsidiary to meet all its obligation, to the extent the subsidiary is unable to meet its obligations.

Defined-benefits plans:

In terms of the guidance note issued by the Institute of Actuaries of India, the actuary has provided a valuation of provident fund liability based on the assumptions listed below and determined a shortfall of Rs. 10.54 Lakhs (Previous year Rs. 10.77 Lakhs) as at 31st March, 2014 and the same is recognised to the statement of profit and loss based on actuarial valuation.

The estimates of future salary increases, considered in the actuarial valuation, take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

The contribution expected to be made by the Company during the financial year 2014-15 is Rs. 58.70 Lakhs (Previous year: amount not ascertainable).

Other Post Retirement Benefits

The information in respect of medical cost trend rates and the effect of an increase / decrease of 1% point in the assumed medical cost trend rates on current service cost, interest cost, accumulated post employment benefit cost and experience adjustment is not available; during the year, medical cost of Rs. (12.05) Lakhs (Previous year: Rs. 2.21 Lakhs) is recognised to the statement of profit and loss based on actuarial valuation.

The Company has charged amounts aggregating Rs. 78.29 Lakhs; (Previous year: Rs. 76.62 Lakhs) to the statement of profit and loss based on actuarial valuation [Present value of future obligation as at 31st March, 2014 Rs. 384.17 Lakhs; (Previous year: Rs. 359.84 Lakhs)] and paid Rs. 53.96 Lakhs (Previous year: Rs. 55.64 Lakhs), towards the post retirement arrangements to former Managing Directors and other Directors.

3. Segment reporting

The Company has identified business segments as its primary segment and geographical segment as its secondary segment. Business segments are primarily "Engineering", "Shipping and logistics services", "Real estate" and "Energy Solution" segment. The Company caters to the needs of the domestic and export markets.

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

4. (a) Related party disclosures

(A) Holding Company

Shapoorji Pallonji & Company Limited

(B) Subsidiary Companies

1 Eureka Forbes Limited and its subsidiaries:

a Aquamall Water Solutions Limited and its subsidiary:

- Aquadiagnostics Water Research & Technology Centre Limited

b Forbes Lux International AG and its subsidiaries: (w.e.f.

23rd May, 2013)

(i) Lux International AG and its subsidiary: (w.e.f. 5th June, 2013)

- Hogar Paraguay Electrodomesticos S.A. (w.e.f. 5th June, 2013)

(ii) Forbes Lux Group AG Baar and its subsidiary: (w.e.f. 5th June, 2013)

- Lux / Sk / s.r.o (w.e.f. 5th June, 2013) (iii) Lux Italia srl (w.e.f. 5th June, 2013)

(iv) Lux Schweiz AG (w.e.f. 5th June, 2013)

(v) Lux (Deutschland) GmbH and its subsidiaries: (w.e.f. 5th June, 2013)

- Lux Service GmbH (w.e.f. 5th June, 2013)

- Lux Norge A/s (w.e.f. 5th June, 2013)

- Lux Oesterreich GmbH (w.e.f. 5th June, 2013)

- Lux CZ s.r.o (w.e.f. 5th June, 2013)

- Lux Hungaria Kereskedelmi Kft (w.e.f. 5th June, 2013)

c Euro Forbes International Pte. Limited

d Forbes Facility Services Pvt. Limited

e E4 Development & Coaching Limited

f Forbes Enviro Solutions Limited

g Waterwings Equipments Pvt.Ltd.

h Radiant Energy Systems Pvt.Ltd.

i EFL Mauritius Limited and its subsidiary:

- Euro Forbes Mauritius Limited (Upto 19th December, 2013)

j Euro Forbes Financial Services Limited

k Euro Forbes Limited Dubai and its subsidiary:

- Forbes Lux FZCO

2 Forbes Campbell Finance Limited and its subsidiaries a Forbes Bumi Armada Limited

b Forbes Campbell Services Limited

c Forbes Edumetry Limited

d Forbes Technosys Limited

3 Forbes Bumi Armada Offshore Limited

4 Forbes Container Lines Pte. Limited and its subsidiary:

- Forbesline Shipping Services LLC (w.e.f. 10th January, 2013)

5 Volkart Fleming Shipping and Services Limited

(C) Fellow Subsidiaries (where there are transactions):

1 Forvol International Services Limited

2 Gokak Textiles Limited

3 Shapoorji Pallonji Investment Advisors Pvt. Limited

4 Shapoorji Pallonji Energy (Gujarat) Pvt. Limited

5 SP Fabricators Pvt. Limited

(D) Associate Companies (where there are transactions):

1 The Svadeshi Mills Company Limited

2 Coromondal Garments Limited (Subsidiary of The Svadeshi Mills Company Limited)

3 Neuvo Consultancy ServiceLimited

(E) Joint Ventures (where there are transactions):

1 Edumetry Inc

2 Nypro Forbes Products Limited (Joint venture of Forbes Campbell Finance Limited)

3 SCI Forbes Limited

(F) Key Management Personnel:

Managing Director, Mr. Ashok Barat

5. Leases

(a) Finance lease: Company as lessee

The Company has acquired Office Equipments under finance lease for four years.

(i) The gross carrying amount and the accumulated depreciation at the balance sheet date are Rs. 122.14 Lakhs; (Previous year: Rs. 212.31 Lakhs) and Rs. 76.17 Lakhs; (Previous year: Rs.128.32 Lakhs) respectively.

(ii) Depreciation recognised in the statement of profit and loss is Rs. 38.01 Lakhs; (Previous year: Rs. 53.09 Lakhs).

6. Derivative instruments and unhedged foreign currency exposures

The Company enters into Foreign Exchange Contracts being derivative instruments, which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date.

7. Loans and advances to related parties includes interest free loans, relating to which full provision exists in books of accounts, aggregating Rs. 4,756.77 Lakhs (Secured Rs. 4,716.78 Lakhs) as at 31st March, 2014 [Previous year: Rs. 4,756.77 Lakhs (Secured Rs. 4,716.78 Lakhs)] granted to The Svadeshi Mills Company Limited and its subsidiary Coromandal Garments Limited. The Company, being a secured creditor, with adjudicated dues by the official Liquidator, expects to receive the dues when the matter is ultimately disposed off.

8. Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

Mar 31, 2013

1. Corporate Information

Forbes & Company Limited is one of the oldest companies of the world that is still in existence. The Company traces its origin to the year 1767 when John Forbes of Aberdeenshire, Scotland started his business in India. Over the years, the Management of the Company moved from the Forbes Family to the Campbells to the Tata Group and now finally to the well known Shapoorji Pallonji Group. The Company is mainly engaged in the Engineering, Real estate and Shipping & Logistics business; and is listed on the Bombay Stock Exchange.

2. Capital and other commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 424.45 Lakhs; (Previous year: Rs. 468.71 Lakhs) [against which advance paid aggregating Rs. 54.38 Lakhs; (Previousyear: Rs. 103.35Lakhs)]

(b) For commitments relating to lease arrangements, see Note 35(a) and for derivative contracts, see Note 39(a).

(c) The Company along-with other joint venturers, has entered into a "Sponsor Support Deed" with Natixis, Security Trustee, on 15 th July, 2011 by which the Company irrevocably and unconditionally undertaken to the Security Trustee and each of other creditors, to the extent of its shareholding (i.e. 25%) in the Borrower, namely SCI Forbes Limited, a joint venture company, to pay dues if the Borrower does not pay or discharge any of its obligations.

(d) The Company has agreed to provide continuing financial support to Forbes Container Lines Pte. Ltd. wholly owned subsidiary to meet all its obligation, to the extent they are unable to meet their obligations.

3. Segment reporting

The Company has identified business segments as its primary segment and geographical segment as its secondary segment. Business segments are primarily "Engineering", "Shipping and logistics services" and "Real estate" segment. The Company caters to the needs of the domestic and export markets.

Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

4. Related party disclosures

(A) Holding Company

Shapoorji Pallonji & Company Limited

(B) Subsidiary Companies

1 Eureka Forbes Limited and its subsidiaries a Aquamall Water Solutions Limited

b Aquadiagnostics Water Research & Technology Centre Limited (Subsidiary of Aquamall Water Solutions Limited)

c Euro Forbes Financial Services Limited (w.e.f. 2nd April, 2011)

d Euro Forbes International Pte. Limited

e Euro Forbes Limited Dubai (w.e.f. 10th June, 2011)

f Euro Forbes Mauritius Limited

g E4 Development & Coaching Limited

h EFL Mauritius Limited

i Forbes Aquamall Limited (w. e.f. 9th August, 2011 amalgamated with Aquamall Water Solutions Limited)

j Forbes Lux FZCO (w.e.f. 26th June, 2011 subsidiary of Euro Forbes Limited)

k Forbes Facility Services Pvt. Limited

l Forbes Enviro Solutions Limited

m Radiant Energy Systems Pvt. Ltd.

n Waterwings Equipments Pvt. Ltd.

2 Forbes Campbell Finance Limited and its subsidiaries

a Forbes Bumi Armada Limited

b Forbes Campbell Services Limited

c Forbes Edumetry Limited

d Forbes Technosys Limited

3 Forbes Bumi Armada Offshore Limited

4 Forbes Container Lines Pte. Limited and its subsidiary, namely Forbesline Shipping Services LLC

5 Volkart Fleming Shipping and Services Limited

(C) Fellow Subsidiaries (where there are transactions):

1 Afcons Infrastructure Limited

2 Forvol International Services Limited

3 Gokak Textiles Limited

4 Neuvo Consultancy Services Limited (w.e.f. 29th April, 2011)

5 Shapoorji Pallonji Investment Advisors Pvt. Limited

6 Shapoorji Pallonji Energy (Gujarat) Pvt. Limited

7 SP Fabricators Pvt. Limited

(D) Associate Companies (where there are transactions):

1 Euro P2P Direct (Thailand) Co. Limited (Associate of Eureka Forbes Limited)

2 Forbes Lux Group AG, BAAR (Associate of Eureka Forbes Limited)

3 Lux International AG (Associates of Eureka Forbes Limited)

4 The Svadeshi Mills Company Limited

5 Coromondal Garments Limited (Subsidiary of The Svadeshi Mills Company Limited)

6 Nuevo Consultancy Services Limited (w.e.f. 29th April, 2011)[up to 28th April, 2011 joint venture, w.e.f. 29th April, 2011 also fellow subsidiary]

(E) Joint Ventures (where there are transactions):

1 Edumetry Inc

2 Forbes Aquatech Limited (Joint venture of Eureka Forbes Limited)

3 Forbes Concept Hospitality Services Pvt. Limited (Joint venture of Eureka Forbes Limited)

4 Forbes G4S Solutions Pvt. Ltd (Joint venture of Eureka ForbesLimited)

5 Infinite Water Solutions Pvt. Limited (Joint venture of Eureka Forbes Limited)

6 Nypro Forbes Moulds Limited (w.e.f. 1st April, 2011 amalgamated with Nypro Forbes Products Limited) [Joint venture of Forbes Campbell Finance Limited]

7 Nypro Forbes Products Limited (Joint venture of Forbes Campbell Finance Limited)

8 SCI Forbes Limited

(F) Key Management Personnel:

Managing Director, Mr. Ashok Barat

5. Leases

(a) Finance lease: Company as lessee

The Company has acquired Office Equipments under finance lease for four years.

(i) The gross carrying amount and the accumulated depreciation at the balance sheet date are Rs. 212.31 Lakhs; (Previous year: Rs. 212.78 Lakhs) and Rs. 128.32 Lakhs; (Previousyear: Rs. 75.30 Lakhs) respectively.

(ii) Depreciation recognised in the statement of profit and loss is Rs. 53.09 Lakhs; (Previousyear: Rs. 37.69Lakhs).

6. Derivative instruments and unhedged foreign currency exposures

The Company enters into Foreign Exchange Contracts being derivative instruments, which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date.

A) The following are the outstanding Forward Exchange Contracts entered into by the Company as at 31st March, 2013

7. Details of dues to micro and small enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006

The information as required under Micro, Small and Medium Enterprises Development Act, 2006, has been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by Auditors, is as follows:-

8. Loans and advances to related parties includes interest free loans, relating to which full provision exists in books of accounts, aggregating Rs. 4,756.77 Lakhs (Secured Rs. 4,716.78 Lakhs) as at 31st March, 2013 [Previous year: Rs. 4,756.77 Lakhs (Secured Rs. 4,716.78 Lakhs)] granted to The Svadeshi Mills Company Limited and its subsidiary Coromandel Garments Limited. Such loans having been granted, free of interest, as financial support to the companies in which the Company has substantial interest, the terms and condition of such loans are, in the opinion of the management, not prejudicial to the interests of the Company.

9. To secure the lenders of SCI Forbes Limited (SFL), a jointly controlled entity, amongst other undertakings, two of the joint venture partners, including the Company, had to, sign a standby charter agreement, under which, in the event the vessels were not on charter with a lender approved third party at anytime during the pendency of the loan, two vessels each would come on automatic charter to the joint venture partners at rates specified in the standby charter agreement. Immediately thereafter the global financial crisis occurred with shipping being badly hit with charter rates crashing. The lenders sought a change in some commercial terms for agreeing to approve charterers and other forms of vessel deployment. Whilst this negotiation was going on, the loan covenant had got activated and the Company (as also its other JV partner) had to take the vessels on charter at standby charter rates and deploy them on market rates resulting in the loss of Rs. 513 Lakhs during previous year ended 31st March, 2012. With effect from 1st July, 2011, the aforesaid standby charter agreement has been suspended and consequently the ships have been re-delivered by the Company as also by the joint venture partner to SFL. Non-provision of estimated loss arising from the aforesaid onerous standby charter agreements not being in accordance with the requirements of Accounting Standard 29, ''Provisions, Contingent Liabilities and Contingent Assets'' (AS-29) was a subject matter of a qualification in the audit report for the year ended 31st March, 2011.

10. Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classificaton / disclosure.

Mar 31, 2012

1. Corporate Information

Forbes & Company Limited is one of the oldest companies of the world that is still in business. The Company traces its origin to the year 1767 when John Forbes of Aberdeenshire, Scotland started his business in India. Over the years, the Management of the Company moved from the Forbes Family to the Campbells to the Tata Group and now finally to the well known Shapoorji Pallonji Group. The Company is mainly engage in the Engineering, Real estate and Shipping & Logistics business and listed on the Bombay Stock Exchange.

(a) Rights, preferences and restrictions attached to equity shares

The Company has only one class of shares referred to as equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

(b) Equity shares held by holding company and subsidiary company 92,95,293 (Previous year: 92,95,293) equity shares are held by the holding company, Shapoorji Pallonji & Company Limited; and 1,66,398 (Previous year: 1,66,398) equity shares are held by a subsidiary of the Company, Forbes Campbell Finance Limited.

2. Contingent liabilities:

(a) In the year 1994-95, the Company had entered in to a Memorandum of Understanding giving sole and exclusive right for developing a part of its land at Chandivali, Mumbai. The Developer had filed a suit against the Company for recession of the said Memorandum of Understanding and has claimed a sum of Rs. 3,271.48 Lakhs and has asked interest at 21% per annum with effect from April, 1998. The Company had been contesting the aforesaid claim. This has been settled out of court on 22nd December, 2011 and the aforesaid claim is withdrawn by the developer.

As at As at 31st March, 31st March, 2012 2011 Rs.in Lakhs Rs.in Lakhs

(b) Taxes in dispute:-

(i) Excise demand 4,730.86 4,745.04

(ii) Sales tax 770.32 809.61

(iii)Income-tax 1,505.36 1,525.83

(iv) Customs duty 17.10 17.10

(v) Wealth tax 36.12 36.12

(vi) Property tax 1,075.85 934.07

(c) Labour matters in dispute 10.00 68.50

(d) Claim of Gujarat Electricity Board for alleged diversion of fraction of the power consumed and contested by the Company in the Court 188.29 188.29

(e) Customer claims 76.01 212.53

(f) Supplier claims 15.00 15.00

(g) Other legal matters 6.20 6.20

(h) Guarantees:-

(i) Guarantees given on behalf of Shipping Principals including subsidiary and Surety Bonds jointly executed with third parties in favour of customs and other parties 4,857.50 4,857.50

(ii) Guarantee on behalf of a subsidiary company 2,325.49 200.00

(iii) Guarantees issued by bank 317.83 308.34

(i) Other money for which the Company is contingently liable

Bills discounted 80.01 101.21

3. Capital and other commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 468.71 Lakhs; (Previous year: Rs. 582.48Lakhs) [net of advance paid aggregating Rs. 103.35 Lakhs; (Previousyear: Rs. 209.28Lakhs)]

(b) For commitments relating to lease arrangements, see Note 34(a) and for derivative contracts, see Note 40(a).

(c) The Company along-with other joint venturers, has entered into a "Sponsor Support Deed" with Natixis, Security Trustee, on 15th July, 2011 by which the Company irrevocably and unconditionally undertaken to the Security Trustee and each of other creditors, to the extent of its shareholding (i.e. 25%) in the Borrower, namely SCI Forbes Limited, a joint venture company, if the Borrower do not pay or discharge any of its obligations.

(d) The Company has agreed to provide continuing financial support to Forbes Container Lines Pte. Ltd. wholly owned subsidiary to meet all its obligation, to the extent they are unable to meet their obligations.

(e) Also see Note 49.

Defined-benefits plans:

In terms of the guidance note issued by the Institute of Actuaries of India, the actuary has provided a valuation of provident fund liability based on the assumptions listed below and determined that there is no shortfall as at 31st March, 2012. During the previous year, the Company had made a provision of Rs. 21.35 lakhs towards interest shortfall on an estimated basis in the absense of actuarial valuation.

The assumptions used in determining the present value of obligation of the interest rate guarantee under deterministic approach are:- Remaining terms of maturity 17 years.

Expected guarantee interest rate 8.25%.

Discount rate for the remaining term to maturity of interest portfolio 8.15%.

The actuarial calculations used to estimate defined benefit commitments and expenses are based on the following assumptions which if changed, would affect the defined benefit commitment's size, funding requirements and expense.

* Figures in respect of Financial Year 2007-08 are not available.

The estimates of future salary increases, considered in the actuarial valuation, take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

The contribution expected to be made by the Company during the financial year 2012-13 has not been ascertained.

The information in respect of medical cost trend rates and the effect of an increase / decrease of 1% point in the assumed medical cost trend rates on current service cost, interest cost, accumulated post employment benefit cost and experience adjustment is not available; during the year, medical cost of Rs. 46.93 Lakhs (Previous year: Rs. 47.15Lakhs) recognised to the statement of profit and loss based on actuarial valuation.

The Company has charged amounts aggregating Rs. 74.30 Lakhs; (Previous year: Rs. 46.72 Lakhs) to the statement of profit and loss based on actuarial valuation [Present value of future obligation as at 31st March, 2012 Rs. 338.86 Lakhs; (Previous year: Rs. 315.90 Lakhs)] and paid Rs. 51.34 Lakhs (Previous year: Rs. 61.06Lakhs), towards the post retirement arrangements to former Managing Directors and other Directors.

4. Related party disclosures

(A) Holding Company / Ultimate Holding Company

1 Shapoorji Pallonji & Company Limited [Holding Company (Ultimate Holding Company upto 14th October, 2010)]

2 Sterling Investment Corporation Private Limited (Holding Company upto 14th October, 2010, merged with Shapoorji Pallonji & Company Limited w.e.f. 15th October, 2010)

(B) Subsidiary Companies

1 Eureka Forbes Limited and its subsidiaries a Aquamall Water Solutions Limited

b Aquadiagnostics Water Research & Technology Centre Limited (Subsidiary of Aquamall Water Solutions Limited)

c Euro Forbes Financial Services Limited (w.e.f. 2nd April, 2011)

d Euro Forbes International Pte. Limited

e Euro Forbes Limited Dubai (w.e.f. 10th June, 2011)

f E4 Development & Coaching Limited

g EFL Mauritius Limited (w.e.f. 2nd December, 2010)

h Forbes Aquamall Limited (w.e.f. 9th August, 2011 amalgamated with Aquamall Water Solutions Limited) i Forbes Lux FZCO ( w.e.f. 26th June, 2011 subsidiary of Euro Forbes Limited) j Forbes Facility Services Pvt. Limited k Forbes Enviro Solutions Limited l Radiant Energy Systems Pvt. Limited m Waterwings Equipments Pvt. Limited

2 Forbes Campbell Finance Limited and its subsidiaries a Forbes Bumi Armada Limited

b Forbes Campbell Services Limited c Forbes Edumetry Limited

d Forbes Smart Data Limited (Wound up on 30th March, 2011) e Forbes Technosys Limited

3 Forbes Bumi Armada Offshore Limited (w.e.f. 29th October, 2010)

4 Forbes Container Lines Pte. Limited

5 Volkart Fleming Shipping and Services Limited

(C) Fellow Subsidiaries (where there are transactions):

1 Afcons Infrastructure Limited

2 Forvol International Services Limited

3 Gokak Textiles Limited

4 Shapoorji Pallonji Investment Advisors Pvt. Limited (formerly Euphoria Properties Pvt. Limited)

5 Shapoorji Pallonji Energy (Gujarat) Pvt. Limited

6 Sterling and Wilson Limited

7 SP Fabricators Pvt. Limited

(D) Associate Companies (where there are transactions):

1 The Svadeshi Mills Company Limited

2 Coromondal Garments Limited (Subsidiary of The Svadeshi Mills Company Limited)

3 Nuevo Consultancy Services Limited (formerly Forbes Infotainment Limited) (w.e.f. 29th April, 2011)[up to 28th April, 2011 joint venture, w.e.f. 29th April, 2011 also fellow subsidiary]

(E) Joint Ventures (where there are transactions):

1 Edumetry Inc

2 Nuevo Consultancy Services Limited (formerly Forbes Infotainment Limited) (upto 28th April, 2011)[w.e.f. 29th April, 2011 associate and also fellow subsidiary]

3 Nypro Forbes Moulds Limited (formerly known as Nypro Forbes Moulds Pvt. Limited) [Joint venture of Forbes Campbell Finance Limited]

4 Nypro Forbes Products Limited (formerly known as Nypro Forbes Products Private Limited) [Joint venture of Forbes Campbell Finance Limited]

5 SCI Forbes Limited

(F) Key Management Personnel:

Managing Director, Mr. Ashok Barat

5. Leases

(a) Finance lease: Company as lessee

The Company has acquired Office Equipments under finance lease of four years.

(i) The gross carrying amount and the accumulated depreciation at the balance sheet date are Rs. 212.78 Lakhs; (Previous year: Rs. 90.16Lakhs) and Rs. 75.30 Lakhs; (Previous year: Rs. 37.61 Lakhs) respectively.

(ii) Depreciation recognised in the statement of profit and loss is Rs. 37.69 Lakhs; (Previous year: Rs. 22.54Lakhs).

Deferred tax asset has been recognised in respect of unabsorbed depreciation and other items to the extent that future taxable income will be available from future reversal of deferred tax liability recognised at the balance sheet date and is restricted to the extent of such liabilities. As a prudent measure, the excess deferred tax asset (net) has not been recognised in the accounts as there is no virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realised.

6. Standby charter agreement

To secure the lenders of SCI Forbes Limited (SFL), a jointly controlled entity, amongst other undertakings, two of the joint venture partners, including the Company, had to, sign a standby charter agreement, under which, in the event the vessels were not on charter with a lender approved third party at anytime during the pendency of the loan, two vessels each would come on automatic charter to the joint venture partners at rates specified in the standby charter agreement. Immediately thereafter the global financial crisis occurred with shipping being badly hit with charter rates crashing. The lenders sought a change in some commercial terms for agreeing to approve charterers and other forms of vessel deployment. Whilst this negotiation was going on, the loan covenant had got activated and the Company (as also its other JV partner) had to take the vessels on charter at standby charter rates and deploy them on market rates resulting in the loss of Rs. 513.33 Lakhs (Previous year: Rs. 2,164.09 Lakhs). With effect from 1st July, 2011, the aforesaid standby charter agreement has been suspended and consequently the ships have been re-delivered by the Company as also by the joint venture partner to SFL. Non-provision of estimated loss arising from the aforesaid onerous standby charter agreements not being in accordance with the requirements of Accounting Standard 29, 'Provisions, Contingent Liabilities and Contingent Assets' (AS-29) was a subject matter of a qualification in the audit report for the year ended 31st March, 2011.

7. Derivative instruments and unhedged foreign currency exposures

The Company enters into Foreign Exchange Contracts being derivative instruments, which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date.

A) The following are the outstanding Forward Exchange Contracts entered into by the Company as at 31st March, 2012

8. The Company had signed an undertaking for non-disposal of shares held by it in Nypro Forbes Moulds Pvt. Ltd. under the promoter's / borrowing agreement. However, in an earlier year, the Company had transferred its shareholding in Nypro Forbes Moulds Pvt. Ltd. to Forbes Finance Limited, an erstwhile wholly owned subsidiary Company which has merged with Forbes Campbell Finance Limited, a wholly owned subsidiary company, pursuant to the scheme of amalgamation. The novation and assignment of joint venture agreement is still under process.

9. Loans and advances to related parties includes interest free loans aggregating Rs. 4,756.77 Lakhs (Secured Rs. 4,716.78 Lakhs) as at 31st March, 2012 [Previous year: Rs. 4,742.44 Lakhs (Secured Rs. 4,716.78 Lakhs)] granted to The Svadeshi Mills Company Limited and its subsidiary Coromandel Garments Limited. Such loans having been granted, free of interest, as financial support to the companies in which the Company has substantial interest, the terms and condition of such loans are, in the opinion of the management, not prejudicial to the interests of the Company.

10. The Company has investments in equity shares and preference shares aggregating Rs. 7,090 Lakhs in its Joint Venture Company, viz. SCI Forbes Limited, which has four chemical tankers (vessels) currently deployed on time charter. In the opinion of the management, the downturn in the shipping industry in the recent past is exceptional in nature and is considered to be a temporary event. The chemical business is expected to grow in near future and having regard to very low level of order position for new vessels, there would be better deployment of existing vessels which would improve the charter hire rates. Based on the present value of estimated future cash flow expected to arise from the continuing use of vessels and from its disposal at the end of its useful life, no provision for diminution in value of these investments, held as non-current, is required to be made.

11. Account balances of trade payables and other current liabilities aggregating to Rs. 2,386.15 Lakhs and trade receivables, long term / short term loans and advances and other current assets aggregating to Rs. 1,321.48 Lakhs relating to the Shipping and Logistics division are in the process of detailed review and reconciliation. This was a subject matter of qualification in the audit report for the year ended 31st March, 2011 and continues to be a subject matter of qualification in the audit report for the year ended 31st March, 2012. The Management expects that the net effect on the financial results would not be material on completion of this exercise.

12. The Revised Schedule VI has become effective from 1st April, 2011 for the preparation of financial statement. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

Mar 31, 2011

1. Contingent Liability and Provision for Contingencies:

a) In the year 1994-95, the Company had entered in to a Memorandum of Understanding giving sole and exclusive right for developing a part of its land at Chandivali, Mumbai. The Developer had filed a suit against the Company for recession of the said Memorandum of Understanding and has claimed a sum of Rs.3,271.48 Lakhs and has asked interest at 21% per annum with effect from April, 1998. The Company has been legally advised that the aforesaid claim for Rs.3,271.48 Lakhs and interest at 21% per annum is unjustified and is legally untenable. The Company is contesting the aforesaid claim. The matter is sub-judice. Both parties are also in active discussion to reach an out of court settlement in the matter which will enable joint development of the property.

b) Other Contingent Liabilities not provided for:

(Rs. in Lakhs)

Current Previous Year Year

(A) Bills discounted 101.21 42.83

(B) Guarantees issued by bank 506.88 448.62

(C) Taxes in dispute :-

(i)Excise demand 4,745.04 4,745.04

(ii) Sales Tax 809.61 873.54

(iii) Income-tax 1,525.83 1,440.32

(iv) Customs duty 17.10 17.10

(v) Wealth tax 36.12 36.12

(vi) Property Tax 934.07 671.60

(D) Labour matters in dispute 68.50 63.25

(E) Claim of Gujarat Electricity Board for alleged diversion of fraction of the power consumed and contested by the Company in the Court 188.29 188.29

(F) Guarantees given on behalf of Shipping Principals and Surety Bonds jointly executed with third parties in favour of customs and other parties 3,577.50 3,593.58

(G) Guarantee on behalf of a subsidiary company 200.00 -

(H) Other demands contested by the Company :-

(i) Customer claims against the Company not acknowledged as debts 136.52 137.71

(ii) Supplier claims against the Company not acknowledged as debts 15.00 15.00

2. Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.582.48 Lakhs; (Previous year Rs.59.69 Lakhs) (against which advances paid aggregate Rs.209.28 Lakhs; Previous year Rs.11.31 Lakhs).

3. The Company has charged amounts aggregating Rs.46.72 Lakhs; (Previous year Rs.18.70 Lakhs) to the profit and loss account based on actuarial valuation [Present value of future obligation as at 31st March, 2011 Rs.315.90 Lakhs; (Previous year Rs.330.23 Lakhs)] and paid Rs.61.06 Lakhs (Previous year Rs.48.81 Lakhs), towards the post retirement arrangements to former Managing Directors and other Directors.

4. The information as required under Micro, Small and Medium Enterprises Development Act, 2006, has been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by Auditors, is as follows:- (a) The total amount of delayed payments during the year aggregated to Rs.137.94 Lakhs; (Previous year Rs.3.83 Lakhs) in respect of 40 parties;

(Previous year 4 parties) with amounts ranging from Rs.0.03 Lakh to Rs.61.80 Lakhs; (Previous year Rs.0.01 Lakh to Rs.0.20 Lakh).

(b) The amount of principal outstanding in respect of the above as at Balance Sheet date is Rs.137.11 Lakhs; (Previous year Rs.3.12 Lakhs) in respect of 40 parties; (Previous year 4 parties) with amount ranging from Rs.0.03 Lakh to Rs.61.42 Lakhs; (Previous year Rs.0.01 Lakh to Rs.0.20 Lakh).

(c) The total interest payable on account of delayed payment aggregates to Rs.0.83 Lakh; (Previous year Rs.0.71 Lakh) and this entire amount was outstanding as at the year end.

5 . Based on a legal opinion received, the Company has not deposited the dividend amount of Rs.Nil (Previous year Rs.1.29 Lakhs) to Investor Education and Protection Fund even though amounts are outstanding for more than seven years.

6. In accordance with the Accounting Standard on Leases (AS) 19, disclosures in respect of leases are made below :

A. The Company has acquired Plant and Machinery under finance lease of four years. The particulars in respect of such leases are as follows:

(a) (i) The gross carrying amount and the accumulated depreciation at the balance sheet date are Rs.90.16 Lakhs; (Previous year Rs.90.16 Lakhs) and Rs.37.61 Lakhs; (Previous year Rs.15.07 Lakhs) respectively.

7. The Company had signed an undertaking for non-disposal of shares held by it in Nypro Forbes Moulds Pvt. Ltd. under the promoter's / borrowing agreement. However, in an earlier year, the Company had transferred its share holding in Nypro Forbes Moulds Pvt. Ltd. to Forbes Finance Limited, an erstwhile wholly owned subsidiary Company which has merged with Forbes Campbell Finance Limited, pursuant to the scheme of amalgamation. The novation and assignment of joint venture agreement is still under process.

8. The Company has granted interest free loans aggregating Rs.4742.44 Lakhs (Secured Rs. 4,716.78 Lakhs) as at 31st March, 2011 [Previous year Rs.4,725.61 Lakhs (Secured Rs. 4,716.78)] to The Svadeshi Mills Company Limited and its subsidiary Coromandel Garments Limited. Such loans having been granted, free of interest, as financial support to the companies in which the Company has substantial interest, the terms and condition of such loans are, in the opinion of the management, not prejudicial to the interests of the Company.

9. (a) The Company, as part of a condition imposed by the lenders to SCI Forbes Limited (SFL), a joint venture entity, had entered into a standby charter agreement under which the Company (as also its joint venture partner Shipping Corporation of India (SCI)) committed to charter vessels from SFL at a defined charter rate specified in the agreement in the event the vessels are not on a 'approved' charter with a third party, until SFL repays its borrowings. Given the global financial crisis which impacted freight rates and volumes adversely, the lenders did not 'approve' the proposals by SFL to put the vessels into a pooling arrangement (which was more profitable than putting on long term charter) and hence the standby charter agreement got triggered.

Subsequent to the year end, with effect from 1st July, 2011, the aforesaid standby charter agreement has been suspended and consequently the ships have been re-delivered by the Company to SFL. The loss materialised from 1st April, 2011 to 30th June, 2011 is Rs.515.97 Lakhs which will be accounted in the period in which it materialises as the said stand by agreements are not to be treated as onerous contract as per AS-29 since the triggering of the agreement is dependant on the freight rate prevailing in the market and the discretion of the lenders.

(b) Account balances of sundry creditors / customers' credit balances / advances aggregating Rs.1,781.67 Lakhs; sundry debtors aggregating Rs.838.62 Lakhs and loans and advances aggregating Rs.953.88 Lakhs relating to the Shipping and Logistics segment are in the process of detailed review and reconciliation. The Management expect that the net effect on the profit and loss account would not be material on completion of exercise.

(c) In shipping and logistics due to teething problems in the new ERP system implemented with effect from 1st April, 2010 some of Tax Deducted at Source values were not generated & has resulted in delay in payment of said values.

10. During the previous year, the High Court of Mumbai had approved the demerger of the Shipping Agency Division of Volkart Fleming Shipping and Services Limited, a subsidiary company, into the Company w.e.f. 1st April, 2008. Accordingly, the scheme had been given effect to in the accounts of the previous year and the assets and liabilities of the Shipping Agency Division of Volkart Fleming Shipping and Services Limited, at their respective book values as appearing in the audited divisional balance sheet as at 31st March, 2009 had been transferred to and vested in the Company alongwith the profit for the year ended 31st March, 2009 (the appointed date of the scheme being 1st April, 2008).

Notes:

1 The above figures exclude contribution to Gratuity Fund and Provision for compensated absences provided on actuarial basis as separate figures are not available.

2 The managerial remuneration of Rs.50.33 Lakhs paid during the year is in excess of the limits specified in Schedule XIII of the Companies Act, 1956 and is subject to the approval of the Central Government. During the year, the Company has received approval of the Central Government in respect of managerial remuneration of Rs.37.35 Lakhs paid in excess of limits specified in the aforesaid Schedule XIII during the previous year.

11. Employee Benefit Obligations:- Defined-Contribution Plans:

The Company offers its employees defined contribution plan in the form of family pension fund and superannuation fund. Family pension fund cover substantially all regular employees while the superannuation fund covers certain executives. Contributions are paid during the year into separate funds under certain fiduciary-type arrangements. The contribution into the superannuation fund and Family Pension Fund are made only by the Company. The contributions are based on a certain proportion of the employee's salary.

Defined-Benefits Plans:

According to the Management, actuarial valuation can not be applied to reliably measure provident fund liabilities in respect of fund managed by the trust, set up by the Company. Accordingly, the Company is currently not in a position to provide other related disclosures as required by Accounting Standard (AS) 15 (Revised) on Employee Benefits notified by the Companies (Accounting Standards) Rules, 2006 read with the Guidance issued by the Accounting Standards Board of the Institute of Chartered Accountants of India. During the year, the Company has provided Rs.21.35 Lakhs (Previous year Rs.Nil) towards interest short fall.

The Company offers its employees defined-benefits plans in the form of a gratuity scheme (a lump sum amount), post retirement medical benefits and non compete fees. Benefits under the defined benefit plans are typically based either on years of service and the employee's compensation (generally immediately before retirement). The gratuity scheme covers substantially all regular employees, while post retirement medical benefit covers certain executives. In the case of the gratuity scheme, the Company contributes funds to a Gratuity Trust, which is irrevocable, while post retirement medical benefit and non compete fees are not funded. Commitments are actuarially determined at year end. Actuarial valuation is done based on "Projected Unit Credit" method. Gains and losses of changed actuarial assumptions are charged to the profit and loss account.

A sum of Rs.269.89 Lakhs (Previous Year Rs.235.78 Lakhs) has been charged to the profit and loss account in respect of the contribution to provident fund, family pension fund, superannuation fund and other funds.

12. (a) Related Party Disclosures

(i) Names of related parties and nature of related party relationship. (A) Holding Company / Ultimate Holding Company:

1 Shapoorji Pallonji & Company Limited [Holding Company (Ultimate Holding Company upto 14th October, 2010)]

2 Sterling Investment Corporation Private Limited (Holding Company upto 14th October, 2010, merged with Shapoorji Palonji & Company Limited w.e.f. 15th October, 2010)

(B) Subsidiary Companies:

1 Aquamall Water Solutions Limited (Subsidiary of Eureka Forbes Limited)

2 Aquadiagnostics Water Research & Technology Centre Limited (Subsidiary of Aquamall Water Solutions Limited)

3 Eureka Forbes Limited

4 Euro Forbes International Pte. Limited (Subsidiary of Eureka Forbes Limited)

5 E4 Development & Coaching Limited (Subsidiary of Eureka Forbes Limited)

6 EFL Mauritius Limited (Subsidiary of Eureka Forbes Limited w.e.f. 2nd December, 2010)

7 Forbes Aquamall Limited (Subsidiary of Aquamall Water Solutions Limited)

8 Forbes Bumi Armada Limited (Subsidiary of Forbes Campbell Finance Limited)

9 Forbes Bumi Armada Offshore Limited (w.e.f. 29th October, 2010)

10 Forbes Campbell Services Limited (Subsidiary of Forbes Campbell Finance Limited)

11 Forbes Container Lines Pte. Limited

12 Forbes Edumetry Limited (Subsidiary of Forbes Campbell Finance Limited)

13 Forbes Facility Services Pvt. Limited (Subsidiary of Eureka Forbes Limited)

14 Forbes Smart Data Limited [Subsidiary of Forbes Campbell Finance Limited (upto 30th March, 2011)]

15 Forbes Technosys Limited (Subsidiary of Forbes Campbell Finance Limited)

16 Forbes Enviro Solutions Limited (Subsidiary of Eureka Forbes Limited)

17 Forbes Campbell Finance Limited

18 Radiant Energy Systems Pvt. Limited (Subsidiary of Eureka Forbes Limited)

19 Waterwings Equipments Pvt. Limited (Subsidiary of Eureka Forbes Limited)

20 Volkart Fleming Shipping and Services Limited

(C) Fellow Subsidiaries (where there are transactions):

1 Forvol International Services Limited

2 Gokak Textiles Limited

3 Afcons Infrastructure Ltd.

4 Sterling and Wilson Limited

5 SP Fabricators Pvt. Limited

(D) Associate Companies (where there are transactions):

The Svadeshi Mills Company Limited

(E) Joint Ventures (where there are transactions):

1 Edumetry Inc

2 Forbes Infotainment Limited

3 Nypro Forbes Moulds Pvt. Limited (Joint venture of Forbes Campbell Finance Limited)

4 Nypro Forbes Products Pvt. Limited (Joint venture of Forbes Campbell Finance Limited)

5 SCI Forbes Limited

(F) Key Management Personnel:

Managing Director, Mr. Ashok Barat

27. (b) Related Party Disclosures

(i) Names of related parties and nature of related party relationship for the year ended 31st March, 2010.

(A) Holding Company / Ultimate Holding Company:

1 Shapoorji Pallonji & Company Limited (Ultimate Holding Company)

2 Sterling Investment Corporation Private Limited (Holding Company)

(B) Subsidiary Companies:

1 Aquamall Water Solutions Limited (Subsidiary of Eureka Forbes Limited)

2 Aquadiagnostics Water Research & Technology Centre Limited (Subsidiary of Aquamall Water Solutions Limited)

3 Eureka Forbes Limited

4 Euro Forbes International Pte. Limited (Subsidiary of Eureka Forbes Limited)

5 E4 Development & Coaching Limited (Subsidiary of Eureka Forbes Limited)

6 Forbes Aquamall Limited (Subsidiary of Aquamall Water Solutions Limited)

7 Forbes Bumi Armada Limited (Subsidiary of Forbes Campbell Finance Limited)

8 Forbes Campbell Services Limited (Subsidiary of Forbes Campbell Finance Limited)

9 Forbes Container Lines Pte. Limited

10 Forbes Doris and Naess Maritime Limited (wound up on 29th April, 2009)

11 Forbes Edumetry Limited (Subsidiary of Forbes Campbell Finance Limited)

12 Forbes Facility Services Pvt. Limited (Subsidiary of Eureka Forbes Limited)

13 Forbes Smart Data Limited (Subsidiary of Forbes Campbell Finance Limited)

14 Forbes Technosys Limited (Subsidiary of Forbes Campbell Finance Limited)

15 Forbes Tinsley Company Limited (wound up on 23rd June, 2009)

16 Forbes Enviro Solutions Limited (Subsidiary of Eureka Forbes Limited)

17 Forbes Campbell Finance Limited

18 Next Gen Publishing Limited (from 26th May, 2009 to 14th February, 2010)

19 Radiant Energy Systems Pvt. Limited (Subsidiary of Eureka Forbes Limited)

20 Waterwings Equipments Pvt. Limited (Subsidiary of Eureka Forbes Limited)

21 Volkart Fleming Shipping and Services Limited

(C) Fellow Subsidiaries (where there are transactions):

1 Afcons Infrastructure Limited

2 Forvol International Services Limited

3 Gokak Textiles Limited

4 SP Fabricators Pvt. Limited

(D) Associate Companies (where there are transactions):

The Svadeshi Mills Company Limited

(E) Joint Ventures (where there are transactions):

1 Edumetry Inc.

2 Forbes Infotainment Limited

3 Nypro Forbes Moulds Pvt. Limited (Joint venture of Forbes Campbell Finance Limited)

4 Nypro Forbes Products Pvt. Limited (Joint venture of Forbes Campbell Finance Limited)

5 SCI Forbes Limited

(F) Key Management Personnel:

Managing Director, Mr. Ashok Barat

Footnotes:

1 Installed capacity has been certified by the Management and accepted by Auditors without verification, this being a technical matter.

2 Production is derived after reducing the aggregate of opening stock and purchases from the aggregate of closing stock and sales.

3 Quantity whereof is not ascertainable. (comprise diverse products in respect of which quantities cannot be practicably aggregates.)

4 In arriving at the quantities disclosed in metric tonnes, standard conversion factors have been used.

29. (a) Segment Reporting

The Company has disclosed Business Segment as the primary segment. Segment have been identified taking into account the nature of the products, risks and returns, organisation structure and internal reporting system.

The Company's operations predominantly relate to "Engineering", "Motors", "Shipping and Logistics Services", "Personal Wear" and "Real Estate" The Company caters to the needs of the Domestic and Export Markets.

Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

30. Figures of previous years have been regrouped wherever necessary.

Mar 31, 2010

1. Contingent Liability and Provision for Contingencies:

a) In the year 1994-95, the Company had entered in to a Memorandum of Understanding giving sole and exclusive right for developing a part of its land at Chandivali, Mumbai. The Developer had filed a suit against the Company for recession of the said Memorandum of Understanding and has claimed a sum of Rs.3,271.48 Lakhs and has asked interest at 21% per annum with effect from April, 1998. The Company has been advised that the aforesaid claim for Rs.3,271.48 Lakhs and interest at 21% per annum is unjustified and is legally untenable. The Company is contesting the aforesaid claim. The matter is sub-judice.

b) Other Contingent Liabilities not provided for: (Rs. In Lakhs)

Current Previous Year Year

(A) Bills discounted 42.83 181.00

(B) Guarantees issued by bank 418.62 664.73

(C) Taxes in dispute :-

(i) Excise demand [Advance paid against the demand Rs.15.29 Lakhs; (Previous year Rs.15.29 Lakhs)] 4,745.04 4,745.04

(ii) Sales Tax [Advance paid Rs.68.58 Lakhs; (Previous year Rs.66.97 Lakhs)] 873.54 1,144.51

(iii) Income-tax 1,440.32 1,119.22

(iv) Customs duty 17.10 -

(v) Wealth tax 36.12 36.12

(vi) Property Tax 409.81 409.81

(D) Labour matters in dispute 69.25 49.31

(E) Claim of Gujarat Electricity Board for alleged diversion of fraction of the power consumed and contested by the Company in the Court 188.69 188.69

(F) Guarantees given on behalf of Shipping Principals and Surety Bonds jointly executed with third parties in favour of customs and other parties 1,683.08 2,973.00

(G) Guarantees given in favour of customs authorities 6.00 6.00

(H) Guarantee Bonds on behalf of others 30.00 43.68

(I) Other demands contested by the Company :-

(i) Customer claims against the Company not acknowledged as debts 137.71 136.52

(ii) Supplier claims against the Company not acknowledged as debts 15.00 15.00

(iii) Rent - 3.00

The Company does not expect any liability to devolve on it on account of the above referred contingent liabilities and therefore no provision is held.

2. Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.59.69 Lakhs; (Previous year Rs.963.05 Lakhs) (against which advances paid aggregate Rs.11.31 Lakhs; Previous year Rs.6.23 Lakhs).

3. The Company has charged monthly amounts aggregating Rs.18.70 Lakhs; (Previous year Rs.120.33 Lakhs) to the profit and loss account based on actuarial valuation [Present value of future obligation as at 31st March, 2010 Rs.330.23 Lakhs; (Previous year Rs.354.85 Lakhs)], towards the post retirement arrangements to former Managing Director and other Directors.

4. The Company has incurred Rs.Nil; (Previous year Rs.13.97 Lakhs) on Research and Development. These amounts have been expensed out during the year.

5. The information as required under Micro, Small and Medium Enterprises Development Act, 2006 as received by the Company and relied upon by Auditors is as follows:- (a) The total amount of delayed payments during the year aggregated to Rs.3.84 Lakhs; (Previous year Rs.26.53 Lakhs) in respect of 4 parties;

(Previous year 3 parties) with amounts ranging from Rs.0.01 Lakh to Rs.0.20 Lakh; (Previous year Rs.0.01 Lakh to Rs.6.92 Lakhs).

(b) The amount of principal outstanding in respect of the above as at Balance Sheet date is Rs.3.12 Lakhs; (Previous year Rs.6.76 Lakhs) in respect of 4 parties; (Previous year 3 parties) with amount ranging from Rs.0.01 Lakh to Rs.0.20 Lakhs; (Previous year Rs.0.02 Lakh to Rs.4.28 Lakhs).

(c) The total interest payable on account of delayed payment aggregates to Rs.0.71 Lakh; (Previous year Rs.0.47 Lakh) and this entire amount was outstanding as at the year end.

During the previous year, the company had offset deferred tax assets aggregating Rs.398.15 Lakhs against General Reserve. These deferred tax assets were recognised in earlier years in respect of voluntary retirement compensation liabilities which were offset against General Reserve as at 31st March, 2007, in terms of scheme of demerger of the Textile Division into a seperate company viz. Gokak Textiles Limited approved by the Honourable High Court of Judicature at Bombay and the Honourable High Court of Karnataka.

Deferred tax assets in respect of unabsorbed depreciation is recognised having regard to the deferred tax liability arising from timing differences in respect of depreciation charge on the fixed assets, the reversal of which is virtually certain.

6. Based on a legal opinion received, the Company has not deposited the dividend amount of Rs.1.29 Lakhs (Previous year Rs.0.51 Lakh) to Investor Education and Protection Fund even though amounts are outstanding for more than seven years.

7. In accordance with the Accounting Standard on Leases (AS) 19, disclosures in respect of leases are made below :

A. The Company has acquired Plant & Machinery under finance lease of four years. The particulars in respect of such leases are as follows:

(a) (i) The gross carrying amount and the accumulated depreciation at the balance sheet date are Rs.90.16 Lakhs; (Previous year Rs.77.95 Lakhs) and Rs.15.07 Lakhs; (Previous year Rs.47.65 Lakhs) respectively. (ii) Depreciation recognised in the profit and loss account is Rs.15.07 Lakhs; (Previous year Rs.8.06 Lakhs)

B. (i) The Company has taken certain office premises on operating lease basis. Lease payments in respect of such leases recognised in Profit and Loss Account Rs.109.73 Lakhs; (Previous Year Rs.231.63 Lakhs).

(iii) Except for the escalation clauses contained in certain lease arrangements providing for increase in the lease payment by a specified percentages / amounts after completion of specified period, the lease agreements do not contain any renewal clause. Further, the lease terms do not contain any exceptional / restrictive covenants other than prior approval of the lessee before renewal of lease.

(iv) There are no restrictions such as those concerning dividend and additional debt other than in some cases where prior approval of lessor is necessitated for further leasing.

(v) Other lease arrangements, in respect of which payments are made by the Company, are cancellable.

8. The Company had signed an undertaking for non-disposal of shares held by it in Nypro Forbes Moulds Pvt. Ltd. under the promoters / borrowing agreement. However, in the previous year, the Company had transferred its share holding in Nypro Forbes Moulds Pvt. Ltd. to Forbes Finance Limited, an erstwhile wholly owned subsidiary Company which has merged with Forbes Campbell Finance Limited (formerly known as Latham India Limited), pursuant to the scheme of amalgamation. The novation and assignment of joint venture agreement is still under process.

9. The Company has granted interest free loans aggregating Rs.4,725.61 Lakhs (Secured Rs. 4,716.78 Lakhs) as at 31st March, 2010 [Previous year Rs.4,716.78 Lakhs (Secured Rs. 4,716.78)] to The Svadeshi Mills Company Limited and Coromandel Garments Limited. Such loans having been granted, free of interest, as financial support to the companies in which the Company has substantial interest, the terms and condition of such loans are, in the opinion of the management, not prejudicial to the interests of the Company.

10. The Company, as part of a condition imposed by the lenders to SCI Forbes Limited (SFL), a joint venture entity, had entered into a standby charter agreement under which the Company (as also its joint venture partner Shipping Corporation of India (SCI)) committed to charter vessels from SFL at a defined charter rate specified in the agreement in the event the vessels are not on a Ãapproved charter with a third party, until SFL repays its borrowings. Given the global financial crisis which impacted freight rates and volumes adversely, the lenders did not Ãapprove the proposals by SFL to put the vessels into a pooling arrangement (which was more profitable than putting on long term charter) and hence the standby charter agreement got triggered.

The Company and SCI have already signed a term sheet with the lenders of SFL under which the aforesaid standby charter agreement will be suspended; this term sheet is awaiting approval of the Korean Export Import Corporation, the loan guarantor, which approval is expected shortly. The loss materialised till date subsequent to 31st March, 2010 is Rs.735.80 Lakhs. This loss will be accounted in the period in which it materialises and the said stand by agreements are not to be treated as onerous contract as per AS-29 as the triggering of the agreement is dependant on the freight rate prevailing in the market and the discretion of the lenders.

11. On 6th November, 2009, the High Court, Mumbai has approved the demerger of the Shipping Agency Division of Volkart Fleming Shipping and Services Limited, a subsidiary company, into the company w.e.f. 1st April, 2008. The order has since been received and filed with the Registrar of Companies. Accordingly, the scheme has been given effect to in the accounts and the assets and liabilities of the Shipping Agency Division of Volkart Fleming Shipping and Services Limited, at their respective book values as appearing in the audited divisional balance sheet as at 31st March, 2009 have been transferred to and vested in the company alongwith the profit for the year ended 31st March, 2009 (the appointed date of the scheme being 1st April, 2008).

12. Employee Benefit Obligations:- Defined-Contribution Plans:

The Company offers its employees defined contribution plan in the form of provident fund, family pension fund and superannuation fund. Provident fund and family pension fund cover substantially all regular employees while the superannuation fund covers certain executives. Contributions are paid during the year into separate funds under certain flduciary-type arrangements. While both the employees and the Company pay predetermined contributions into the provident fund and family pension fund, the contribution into the superannuation fund are made only by the Company. The contributions are normally based on a certain proportion of the employees salary.

A sum of Rs.235.78 Lakhs (Previous Year Rs.257.13 Lakhs) has been charged to the revenue account in this respect.

Defined-Benefits Plans:

The Company offers its employees defined-benefits plans in the form of a gratuity scheme (a lump sum amount), compensated absences, post retirement medical benefits and non compete fees. Benefits under the defined benefit plans are typically based either on years of service and the employees compensation (generally immediately before retirement). The gratuity scheme covers substantially all regular employees, while post retirement medical benefit covers certain executives. In the case of the gratuity scheme, the Company contributes funds to a Gratuity Trust, which is irrevocable, while the gratuity for one of the division, post retirement medical benefit and non compete fees are not funded. Commitments are actuarially determined at year end. On adoption of the revised Accounting Standard (AS-15) on "Employee Benefits", actuarial valuation is done based on "Projected Unit Credit" method. Gains and losses of changed actuarial assumptions are charged to the profit and loss account.

The net value of the defined benefit commitment is detailed below:

The amounts of the present value of the obligation, fair value of the plan assets, surplus or deficit in the plan, experience adjustments arising on plan liabilities and plan assets for the previous one annual period have not been furnished as the revised AS-15 was adopted by the Company in the financial year 2006-07.

The estimates of future salary increases, considered in the acturial valuation, take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

The contribution expected to be made by the Company during the financial year 2010-11 has not been ascertained.

13. (a) Related Party Disclosures

(i) Names of related parties and nature of related party relationship.

(A) Holding Company / Ultimate Holding Company:

1 Shapoorji Pallonji & Company Limited (Ultimate Holding Company)

2 Sterling Investment Corporation Private Limited (Holding Company)

(B) Subsidiary Companies:

1 Aquamall Water Solutions Limited (Subsidiary of Eureka Forbes Limited)

2 Aquadiagnostics Water Research & Technology Centre Limited (Subsidiary of Aquamall Water Solutions Limited)

3 Eureka Forbes Limited

4 Euro Forbes International Pte. Limited (Subsidiary of Eureka Forbes Limited)

5 E4 Development & Coaching Limited (Subsidiary of Eureka Forbes Limited)

6 Forbes Aquamall Limited (Subsidiary of Aquamall Water Solutions Limited)

7 Forbes Bumi Armada Limited [Subsidiary of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

8 Forbes Campbell Services Limited [Subsidiary of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

9 Forbes Container Lines Pte. Limited

10 Forbes Doris and Naess Maritime Limited (wound up on 29th April, 2009)

11 Forbes Edumetry Limited [Subsidiary of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

12 Forbes Facility Services Pvt. Limited (Subsidiary of Eureka Forbes Limited)

13 Forbes Smart Data Limited [Subsidiary of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

14 Forbes Technosys Limited [Subsidiary of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

15 Forbes Tinsley Company Limited (wound up on 23rd June, 2009)

16 Forbes Enviro Solutions Limited (Subsidiary of Eureka Forbes Limited)

17 Forbes Campbell Finance Limited (formerly known as Latham India Limited)

18 Next Gen Publishing Limited (from 26th May, 2009 to 14th February, 2010)

19 Radiant Energy Systems Pvt. Limited (Subsidiary of Eureka Forbes Limited)

20 Waterwings Equipments Pvt. Limited (Subsidiary of Eureka Forbes Limited)

21 Volkart Fleming Shipping and Services Limited

(C) Fellow Subsidiaries:

1 Afcons Infrastructure Limited

2 Cyrus Investments Limited

3 Forvol International Services Limited

4 Gokak Textiles Limited

5 Shapoorji Pallonji Ports Pvt. Limited

6 SP Fabricators Pvt. Limited

7 United Motors (India) Limited

(D) Associate Companies:

1 Euro P2P Direct (Thailand) Co. Limited (Associate of Eureka Forbes Limited)

2 Forbes Lux Group AG, BAAR (Associate of Eureka Forbes Limited) (w.e.f. 1st January, 2009)

3 Forbes Lux FZE (Subsidiary of Forbes Lux Group AG, BAAR) (w.e.f. 1st January, 2009)

4 Next Gen Publishing Limited (upto 25th May, 2009)

5 P T Gokak Indonesia (Associate of Forbes Campbell Finance Limited) (upto 27th May, 2009) *

6 The Svadeshi Mills Company Limited

(E) Joint Ventures:

1 Edumetry Inc

2 Forbes Aquatech Limited (Joint venture of Eureka Forbes Limited)

3 Forbes Concept Hospitality Services Pvt. Limited (Joint venture of Eureka Forbes Limited)

4 Forbes Infotainment Limited

5 Forbes Lux Group AG, BAAR (Joint venture of Eureka Forbes Limited) (upto 31st December, 2008)

6 Forbes Lux FZE (Subsidiary of Forbes Lux Group AG, BAAR) (upto 31st December, 2008)

7 Infinite Water Solutions Pvt. Limited (Joint venture of Eureka Forbes Limited)

8 Nypro Forbes Moulds Pvt. Limited [Joint venture of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

9 Nypro Forbes Products Pvt. Limited [Joint venture of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

10 SCI Forbes Limited

11 Meadows Shipping Pvt. Limited (wound up during the year) [Joint Venture of Forbes Campbell Finance Limited (formerly known as Latham India Limited)] *

(F) Key Management Personnel:

1 Managing Director, Mr. Ashok Barat

Pursuant to the scheme of amalgamation, approved by the High Court Judicature at Mumbai on 11th September, 2009, Forbes Finance Limited has amalgamated with Forbes Campbell Finance Limited (formerly known as Latham India Limited) (appointed date of scheme being 1st Aptil, 2008).

30. (b) Related Party Disclosures

(i) Names of related parties and nature of related party relationship for the year ended 31st March, 2009.

(A) Holding Company / Ultimate Holding Company:

1 Shapoorji Pallonji & Company Limited (Ultimate Holding Company)

2 Sterling Investment Corporation Private Limited (Holding Company)

(B) Subsidiary Companies:

1 Aquamall Water Solutions Limited (Subsidiary of Eureka Forbes Limited)

2 Aquadiagnostics Water Research & Technology Centre Limited (Subsidiary of Aquamall Water Solutions Limited)

3 Eureka Forbes Limited

4 Euro Forbes International Pte. Limited (Subsidiary of Eureka Forbes Limited)

5 E4 Development & Coaching Limited (Subsidiary of Eureka Forbes Limited)

6 Forbes Aquamall Limited (Subsidiary of Aquamall Water Solutions Limited)

7 Forbes Bumi Armada Limited (Subsidiary of Forbes Finance Limited) *

8 Forbes Campbell Services Limited (Subsidiary of Forbes Finance Limited) *

9 Forbes Container Lines Pte. Limited

10 Forbes Doris & Naess Maritime Limited

11 Forbes Edumetry Limited (Subsidiary of Forbes Finance Limited) *

12 Forbes Facility Services Pvt. Limited (Subsidiary of Eureka Forbes Limited)

13 Forbes Finance Limited *

14 Forbes Smart Data Limited (Subsidiary of Forbes Finance Limited) *

15 Forbes Sterling Star Limited (upto 8th January, 2009)

16 Forbes Technosys Limited (Subsidiary of Forbes Finance Limited) *

17 Forbes Tinsley Co. Limited

18 Latham India Limited

19 Volkart Fleming Shipping & Services Limited

14 High Point Properties Limited (upto 3rd March, 2009) 21 Sea-Falcon Shipping Services Limited (Subsidiary of Latham India Limited) 22 Sea-Speed Shipping Agencies Limited (Subsidiary of Latham India Limited) 23 Trident Shipping Agencies Limited (Subsidiary of Latham India Limited)

(C) Fellow Subsidiaries:

1 Cyrus Investments Limited

2 Forvol International Services Limited

3 Gokak Textiles Limited

4 Shapoorji Pallonji Ports Pvt. Limited

5 SP Fabricators Pvt. Limited

6 United Motors (India) Limited

(D) Associate Companies:

1 Euro P2P Direct (Thailand) Co. Limited (Associate of Eureka Forbes Limited)

2 Next Gen Publishing Limited

3 P T Gokak Indonesia (Associate of Forbes Finance Limited)

4 The Svadeshi Mills Company Limited

(E) Joint Ventures:

1 Edumetry Inc

2 Forbes Aquatech Limited (Joint venture of Eureka Forbes Limited)

3 Forbes Concept Hospitality Services Pvt. Limited (Joint venture of Eureka Forbes Limited)

4 Forbes Infotainment Limited

5 Forbes Lux Group AG, BAAR (Joint venture of Eureka Forbes Limited)

6 Forbes Lux FZE (Subsidiary of Forbes Lux Group AG, BAAR)

7 Infinite Water Solutions Pvt. Limited (Joint venture of Eureka Forbes Limited)

8 Nypro Forbes Moulds Pvt. Limited (Joint venture of Forbes Finance Limited) *

9 Nypro Forbes Products Pvt. Limited (Joint venture of Forbes Finance Limited) *

10 SCI Forbes Limited

11 Meadows Shipping Pvt. Limited (Joint Venture of Sea-Speed Shipping Agencies Limited) *

(F) Key Management Personnel :

1 Managing Director, Mr. Ashok Barat.

2 Executive Director (Finance), Mr. C G Shah. (upto 30th September, 2008)

- Considering the effect of cross holding among these companies, these companies are covered under the meaning of Subsidiary Company, under Accounting Standard (AS) 18 Related Party Disclosures. These companies are not covered under the definition of Subsidiary Company as contained in Section 3 of the Companies Act, 1956.

* Pursuant to the scheme of amalgamation, approved by the High Court Judicature at Mumbai on 11th September, 2009, Forbes Finance Limited has amalgamated with Forbes Campbell Finance Limited (formerly known as Latham India Limited) (appointed date of scheme being 1st Aptil, 2008).

32. (a) Segment Reporting year ended 31st March, 2010

The Company has disclosed Business Segment as the primary segment. Segment have been identified taking into account the nature of the products, risks and returns, organisation structure and internal reporting system.

The Companys operations predominantly relate to manufacture of "Engineering", "Motors", "Logistics Services", "Personal Wear" and "Real Estate"

The company caters mainly to the needs of the Domestic and Export Markets.

Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. Segment Reporting year ended 31st March, 2009

The Company has disclosed Business Segment as the primary segment. Segment have been identified taking into account the nature of the products, risks and returns, organisation structure and internal reporting system.

The Companys operations predominantly relate to manufacture of "Engineering", "Motors", "Logistics Services", "Personal Wear" and "Real Estate"

The company caters mainly to the needs of the Domestic and Export Markets.

Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

15. Pursuant to the amendment to Section 115JB of the Income-tax Act, 1961, by the Finance Act, 2009 with retrospective effect from Assessment Years beginning 1st April, 2001, the Company has made an additonal provision for taxation in respect of earlier years aggregating Rs.191.00 Lakhs.

16. In view of mergers of Forbes Finance Limited, Trident Shipping Agencies Limited, Sea Falcon Ship Limited and Sea Speed Shipping Agency Limited with Forbes Campbell Finance Limited (formerly known as Latham India Limited), the net worth of Forbes Campbell Finance Limited (formerly known as Latham India Limited) is now positive. This has resulted in the write back of provision for loans and advances and diminution in value of Investment worth Rs.450.34 Lakhs.

17. Figures of previous years have been regrouped wherever necessary.

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